TURKCELL
TURKCELL
INTEGRATED A UAL REPORT 2020
2
Table of Contents
6About Turkcell
Our vision and mission
Turkcell Group:
Developments in 2020
Chairman’s message
Board of Directors
Message from the CEO
Executive Officers
Top Management of
subsidiaries
About the report
20
22
26
32
38
44
50
56
58Value creating Turkcell
Value creating Turkcell:
Technology for life, hope
for the future
Sustainability strategy
Our value creation process
and business model
Strategic focus areas and
business operations
Interactions with our
stakeholders
Measuring the value created
60
62
63
66
72
76
78Strong corporate governance
Management Team support
for value-creation process
Trends and their impacts
Effective risk and crisis
management
Strategic initiatives and
opportunities
126Human capital
84
86
98
102
Human capital
management
Our decent business
practices
Our productive Turkcell
family
Making a difference in
employment
148Manufactured capital
Strong network
Strong fiber infrastructure
Strong spectrum
International sale and
wholesale
130
131
132
144
152
156
157
158
159
106Financial capital
Revenues from operations
Business model hedging
Efficient capital allocation
Diversified financing
Strong and transparent
financial management
Transparent investor
communication - Investor
Relations
Digital finance
transformation
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113
116
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118
123
Techfin’s shining stars:
Paycell and Financell
123
Data centers
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TURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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Table of Contents
160Intellectual capital
Innovation and
entrepreneurship
164
Digital services and solutions
167
Digital business services
(DBS)
Brand and responsibility
173
177 178Our social values
and relations
Turkcell social values and
relations management
Our brand
Strong sales channels and
our services
Our tariffs and packages
Social investment projects
Contribution to exchanging
knowledge and experience
across all stakeholders
Our public affairs
Value oriented, responsible
supply chain management
182
185
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189
194
204
205
207
210Natural capital
Climate crisis management
Energy management
Renewable energy
215
219
220
222Appendices
Appendix-1 Communication
channels table
224
Appendix-2 Cooperated
national, international
and non-governmental
organizations
Appendix-3 Board of
Directors memberships
Appendix-4 Turkcell 2020
awards
Appendix-5 GRI content
index table
225
226
226
228
Appendix-6 UNGC progress
table
238
246Group companies and other
information on corporate
governance
Our subsidiaries
Subsequent events after the
reporting period
2020 financial year
Corporate Governance
Principles Compliance
Report
Other issues regarding
corporate governance
Conclusion of the subsidiary
report
248
254
256
270
272
274Sectoral and
financial information
Turkcell Group 2020 financial
& operational review
276
Forward looking statement
281
Appendix-7 Sustainability
Principles Compliance
Framework table
240
Developments in our
companies and sector
Independent auditor’s report
and consolidated financial
statements
Our offices
Glossary
283
288
401
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TURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
6
About Turkcell
About
Turkcell
20
Our vision and mission
22
26
32
38
Turkcell Group: Developments in 2020
Chairman’s message
Board of Directors
Message from the CEO
44
Executive Officers
50
Top Management of Subsidiaries
56
About the report
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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8
About Turkcell
Turkcell has conducted
its operations in the
communications
and technology
services field as
a pioneer of the
telecommunications
sector in Turkey since
1994. Over the past
27 years, Turkcell has
played a key role
in the development
of Turkey’s
telecommunications
sector, first as a
mobile communication
company, then
as an integrated
telecommunications
operator and
eventually as a digital
operator.
Turkcell Group companies serve their
the total spectrum in Turkey availa-
customers with high-quality voice,
ble for mobile operators’ use. Turk-
messaging, data, and IPTV services
on mobile and fixed networks. More-
over, Turkcell offers its customers val-
cell offers fiber internet speed of up
to 10 Gbps with its FTTH services.
Furthermore, it is the pioneer of 5G
ue-added and innovative services in
research and development stud-
accordance with its strategic focus
ies in Turkey, conducting numerous
areas, namely; digital services, digital
tests and participating in related lo-
business services and techfin servic-
cal and international organizations.
es. Turkcell Group companies operate
in 4 countries - Turkey, Ukraine, Be-
larus, and Northern Cyprus. Turkcell is
dedicated to meeting the communi-
cation needs of its customers to their
high quality standards with its wide
coverage in Turkey and diverse range
of services abroad. Turkcell conducts
its operations to offer opportunities
not only for its customers, but for all
of its stakeholders with the ultimate
goal of creating overall social val-
ue, and accordingly leverages new
technologies, services and prod-
ucts as the leading communications
and technology company of Turkey.
Turkcell launched LTE services in its
home country on April 1, 2016, em-
ploying LTE-Advanced and 3 carrier
aggregation technologies in 81 cit-
ies. Turkcell has a total bandwidth
of 234.4 MHz, equivalent to 43% of
Shareholders
TVF Bilgi Teknolojileri İletişim
Hizmetleri Yat. San. ve Tic. A.Ş.
IMTIS Holdings S.A.R.L.
Publicly traded*
Other
Total
* Publicly traded shares also include the ADS trading at NYSE.
Turkcell has been listed on the Borsa
Istanbul (BIST) and New York Stock
Exchange (NYSE) since July 2000, as
the only Turkish company to be list-
ed on both stock exchanges. Turk-
cell debt instruments are traded on
the Irish Stock Exchange. Turkcell is
a constituent of the MSCI Sustain-
ability Index and the Borsa Istan-
bul Sustainability Index. Turkcell re-
ported TRY29.1 billion of revenues
in 2020 with total assets of TRY51.5
billion as of December 31, 2020.
Turkcell’s new shareholder structure:
Following the amendment of the
Company’s articles of association
at the Ordinary General Assembly
held on October 21, 2020, a new
era began with the share transfer
transactions completed on Octo-
ber 22, 2020, whereby the part-
nership structure was simplified:
Nominal
(TRY thousand)
Share (%)
576,400
435,600
1,187,004
996
26.20
19.80
53.95
0.05
2,200,000
100.00
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For more information about Turkcell, you can visit www.turkcell.com.tr
About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
10
About Turkcell
We stand by our
customers with
our strong telecom
infrastructure
2020 was a year in which the key role of the telecom sector in our
lives and in the economic system was highlighted by the COVID-19
pandemic. During this period, we have stood by our customers
with our wide range of innovative offers and digital propositions,
providing superior customer experience and additional benefits
responding to their changing needs and demand. We sustained
our high quality customer service with a rich value proposition
by leveraging our robust telecom infrastructure. In particular, we
met their rising data demand with our mobile and fixed offerings,
including rich content, as well as our innovative product Superbox
that provides uninterrupted household broadband service at fiber-
like speeds over the mobile network.
Postpaid
subscriber
net additions
1.6
million
Superbox
subscribers
591
thousand
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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About Turkcell
TURKCELL INTEGRATED ANNUAL REPORT 2020
Digital services and
solutions adding
value to life
In a period, during which the demand for digital services
accelerated further with the impact of the pandemic,
we continued to serve our customers with our innovative
and inclusive digital services and solutions developed by
Turkcell engineers, in step with our visionary strategy and
strong business model. And in this environment, where our
customers have preferred to stay home, we have stood
by them with our broad digital services portfolio. We have
made their time at home more enjoyable by offering digital
experience over TV+, fizy, lifebox and Dergilik platforms,
while enabling them to make video calls with their loved
ones via BiP.
Standalone
digital services
revenue
TRY1.3
billion
3
million
paid users
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About Turkcell
TURKCELL INTEGRATED ANNUAL REPORT 2020
Our digital business
services accompany our
customers on their digital
transformation journey
In this period, during which institutions’ digitalization needs have
rapidly risen, we conduct projects enabling companies to make faster
decisions and work more efficiently, not only in areas where we are
at the forefront, but in all matters related to technology, leveraging
our advanced solutions and services developed with a digital
integrator identity. As part of our digital business services focus, we
support companies as a “reliable technology partner” on their digital
transformation journey, while offering necessary products and solutions
to reduce their costs and enable them to access new revenue streams.
Going forward, we will continue to provide the information technology
solutions that our customers need across a wide range of sectors from
transportation to finance, from health to education and logistics, and
from production to retail and energy with a one-stop-shop approach.
Moreover, we will continue to support our customers with our end-to-
end products and services portfolio, ranging from telecom services to
cloud solutions, and from Internet of Things to cyber security.
Digital business
services revenue
growth
30%
System
integration
projects backlog
TRY967
million
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About Turkcell
TURKCELL INTEGRATED ANNUAL REPORT 2020
Effective and reliable
solution to increasing
digital payments
demand through our
techfin services
We facilitate the lives of our customers, meeting their digital
payment needs via the solutions we have created under the
Paycell roof, merging financial and tech services. In the pandemic
environment, where payment habits have changed and the
demand for digital payments has risen rapidly, we have helped
our customers make all their payment transactions swiftly
and securely through Paycell, which is differentiated from its
competitors by its wide product and service portfolio.
Paycell
3-month active
users
4.7
million
Paycell
non-Group
revenue growth
62%
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About Turkcell
TURKCELL INTEGRATED ANNUAL REPORT 2020
Turkcell is creating
sustainable value
We create value for our customers with our innovative and
value-added products and services, while maintaining our
relationships with all stakeholders in our ecosystem with the
principles of being honest, coherent, fair and ethical. In light
of our “Technology for life, hope for the future” motto, we act
on our responsibility to increase social welfare and combat
environmental challenges, while contributing to economic
development. We integrate our fundamental values such as
supply chain transparency, conservation of natural resources
and high customer satisfaction into our business processes.
Investing
1%
of our revenue in
social investment
projects
The target of
meeting all our
electricity demand
from renewables by
2030
Becoming
a carbon-neutral
company by
2050
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TURKCELL INTEGRATED ANNUAL REPORT 2020
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Our vision
Superior digital services
for a better future
Our misson
To add value to the digitalization journey of our customers, both
in Turkey and across the globe, and enrich their lives with our
continuously improving competencies and robust ecosystem
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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About Turkcell
Turkcell Group:
Developments in 2020
Turkcell Group companies operate in
4 countries - Turkey, Ukraine, Belarus,
and the Turkish Republic of Northern
Cyprus (TRNC).*
TURKEY
TURKCELL TURKEY
Mobile customers 33.4 million
Fixed customers 2.4 million
IPTV customers 871 thousand
Revenues TRY25.2 billion
UKRAINE
lifecell
BELARUS
BeST
TRNC
Kuzey Kıbrıs Turkcell
Mobi le customers 9.3 mi llion
Revenues TRY1,776 mi llion
Mobi le customers 1.4 mi llion
Revenues TRY395 mi llion
Mobi le customers 0.5 million
Revenues TRY239 mi llion
* lifecell Europe: The marketing partnership between Turkcell Europe and Telekom Deutschland Multibrand GmbH, the subsidiary of Deutsche Telekom,
ended on April 30, 2020 pursuant to the respective agreement.
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Developments in 2020:
Strong revenue, operational
profitability and net income
performance on the back of
a robust business model and
prudent risk management,
despite the impacts of
COVID-19
Declining leverage and
sustained long FX position
thanks to effective balance
sheet management, despite
challenging macroeconomic
conditions
Revenues
rose to TRY29.1
billion on
15.8%
growth
EBITDA
margin
42.2%
EBIT margin
21.6%
TRY4.2 billion
net income
on a
30.5%
rise
Strong data usage momentum
with accelerated digitalization
demand
Average
monthly data
usage per mobile
subscriber at
11.7 GB on a
58.1%
increase
Average
monthly data
usage per 4.5G
subscriber at
13.6 GB
Leverage
down to
0.8x
Long FX
position at
USD132
million*
Increasing share of digital
sales channels in total sales
with the rising demand for
e-commerce
Share of
digital sales
channels in total
consumer sales*
having risen to
14.3%
(Q420)
30 million
monthly
average website
visitors
Strong cash flow generation
through robust operational
performance and disciplined
capex management
TRY3.4
billion cash flow
generation**
Strong performance in our
strategic focus areas
25.6%
increase in
standalone digital
services
revenues
30.1%
growth in
digital business
services
revenues
62%
rise in
Paycell
non-Group
revenues
Strong ARPU performance thanks
to the rich value proposition and
customer appreciation
Mobile ARPU***
having reached
TRY49.1 on a
15.0%
rise
Residential
fiber ARPU at
TRY70.9 on
9.2%
growth
Sustainability focus as one of the
main components of our business
model
Adoption
of the UN
Sustainable
Development
Goals
We will
continue our
success in
sustainable finance
by increasing
the diversity of
financing
Successful subscriber net
addition performance on robust
infrastructure, innovative services
and solutions, customer-oriented
business approach
1.1
million total net
subscriber
additions
1.6
million
postpaid net
additions
Postpaid
subscribers
having risen to
65.7%
share
* Advance payments are included. ** Free cash flow calculation includes EBITDA and the following items as per IFRS cash flow statement; acquisition of property,
plant and equipment, acquisition of in tangible assets, change in operating assets/liabilities, payment of lease liabilities and income tax paid. *** Excluding M2M.
* Excluding fixed business.
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
26
Chairman’s message
Bülent Aksu
Chairman of the Board of Directors
Please see page 33 for detailed CV.
2020 was a year, in which we wit-
nessed a global health crisis that led to
unprecedented economic, social and
environmental developments in the re-
cent world history. As of March 2020,
the COVID-19 pandemic started to af-
fect our country as well. The pandem-
ic led to various social and economic
challenges that impacted individuals,
businesses and overall society for the
whole year. Our government has de-
veloped policies since the first day of
the pandemic to mitigate its impacts
on our citizens. As Turkcell, we have
also taken several measures to mini-
mize the effects of the pandemic con-
sidering the health of our customers,
business partners and employees.
As the COVID-19 pandemic caused
us to reconsider our knowledge and
habits, it also highlighted the key role
of communications in our lives. Accord-
ingly, we concluded the year having
strengthened and renewed our servic-
es and products so as to better fight
against the negative impacts of this
recently-emerged phenomena.
We successfully met the rising demand
for digital services and telecommuni-
cations offerings during the pandemic
via our robust infrastructure. We con-
tinued to offer the best experience to
our people through our telecom servic-
es, the key to our consistent growth, as
well as our digital products portfolio,
our digital business services that pro-
vide organizations with an end-to-end
digital transformation opportunity, and
our new generation payment systems
in techfin.
Our most important tool to drive value
creation in this challenging environ-
ment was our robust telecommunica-
tions infrastructure, in which we have
invested TRY32 billion over the past
five years. In a period, when telecom
operators around the world requested
internet broadcasters to restrict service
or lower video resolution as a solution
to the intensive use of the network,
we successfully managed a traffic
increase, approaching 50%, with our
robust infrastructure. We continued our
5G preparations at full speed concen-
trating on network transition and R&D
activities. Additionally, we carried out
valuable activities together with our
business partners towards developing
domestic and national 5G products
and digital solutions.
We enabled our customers to meet
all their communication needs with-
out leaving their homes through our
website and Digital Operator appli-
cation, the infrastructure of which we
optimized recently. We increased the
upload speed fourfold to 20 Mbps and
the minimum download speed up to
50 Mbps, to improve the experience
of our fiber internet subscribers for re-
mote working and distance learning.
Due to strong customer interest in high-
er speeds, in September we launched
our 200 Mbps household internet offer.
We provided solutions for those, who
needed communication the most, such
as healthcare workers, our custom-
ers aged 65 and above, and children
continuing distant education, through
support packages. We helped efforts
to raise awareness of the pandemic
communicating #lifesathome caption
to our customers. We made the time
they were obliged to spend at home
more enjoyable by providing addition-
al benefits on our services such as BiP,
Dergilik, fizy and TV+. As the payment
methods of people started to digitize,
our new generation payment platform
Paycell stood out with its easy-to-use
and secure payment infrastructure. The
digital content purchases over Paycell
doubled compared to last year reflect-
ing the change in payment habits.
Video conference systems have be-
come widely used tools in the new
working models led by the pandemic.
However, the security and data privacy
issues associated with various systems
have raised concerns among individ-
ual users and corporations. In order to
address these issues, we rapidly took
the necessary steps to offer our cus-
tomers a secure alternative. Accord-
ingly, thanks to the efforts of Turkcell
engineers , we launched our advanced
digital conference solution, BiP Meet,
and took the remote meeting experi-
ence to the next level.
The developments regarding data pri-
vacy and protection in the early days
of 2021 once again underlined the
critical importance of developing and
using domestic and national applica-
tions. Our communication and life plat-
form BiP, which has been developed
by Turkish engineers and reflects our
commitment to the issue, attracted the
interest of users with the rising aware-
ness of the society on data privacy. BiP
started to be used in many countries
thanks to the features including instant
translation and video calls of up to 10
people, differentiating it from competi-
tion in the international arena. I believe
that as a country, we should be using
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
28
We also stood
beside our people
in need, having
made a TRY20
million donation to
the “Together We
Are Enough My
Turkey” campaign
launched by our
President Mr. Recep
Tayyip Erdoğan.
domestic applications not only in mes-
saging, but in all other fields. We will
inevitably encounter with similar nega-
tive experiences in the future unless we
rely on our own digital solutions.
We implemented a TRY47 million sup-
port package to keep our ecosystem
functioning and preserve employment
as part of the fight against pandem-
ic. We also stood beside our people in
need, having made a TRY20 million do-
nation to the “Together We Are Enough
My Turkey” campaign launched by our
President Mr. Recep Tayyip Erdoğan.
We continued to carry out activities in
the health sector leveraging our quar-
ter-century experience in communi-
cations and technology also in 2020,
when health issues became even more
important. In this period, in which Tur-
key has marked worldwide best prac-
tices in the health sector, four hospi-
tals, two of which were field hospitals,
were opened. We continued to provide
service through the Turkcell Hospital
Information Management System at
Yozgat, Adana, Elâzığ, Eskişehir, Bur-
sa, Başakşehir Çam and Sakura, and
Tekirdağ City Hospitals. All of these
facilities, equipped with Turkcell tech-
nologies, are focused on providing the
best healthcare service to our people.
As the leader in supporting the digital
transformation of our country, we con-
tinued to offer our corporate custom-
ers wide range of solutions including
hosting services, cloud infrastructure,
backup services, disaster
recovery
and security services. In this respect,
we reached a total white space area
of 39,500 m2 with our data centers
established in four cities and at eight
locations. While our traditional data
centers are located in Dudullu, Kar-
tal, Yenibosna and Söğütözü, our new
generation data centers,
that are
equipped with superior technologies
and built to international standards,
are located in Ankara Temelli and Euro-
pean side, Gebze, and İzmir. Our ability
to manage over 11,000 virtual servers
and over 20 petabytes of data for our
corporate customers underpins their
trust in the Turkcell brand. In this con-
text, we continued our activities around
data centers keeping our pace in 2020.
Our data centers, in which we have
invested over TRY2 billion to date, en-
able us to provide services addressing
the needs of the region, backup data
across different geographies, and en-
sure the security of customer data.
We deem compliance with the law on
the protection of personal data as part
of all our products and services among
our top priorities. In this respect, we
took advanced measures with respect
to data privacy and security to ensure
compliance with the regulations of our
country, as well as with the Gener-
al Data Protection Regulation (GDPR),
which we are subject to regarding
our products and services provided in
European Union countries. While our
Compliance Committee carries out
its activities to audit processes, pro-
cedures and policies with respect to
data security, we aim to improve our
risk management and accountability
having established Data Impact Anal-
ysis process. Within the scope of GDPR
compliance, we appointed a Data Pro-
tection Officer (DPO) to the Turkcell
Group. We will continue to implement
all necessary actions to comply with
national and international legislation,
as well as GDPR in the upcoming pe-
riods.
Intellectual capital is undoubtedly a
subject of equal importance to finan-
cial capital in strengthening a compa-
ny. As part of this vision, we conducted
several valuable projects in 2020 in
accordance with diversity and inclu-
siveness principles that shapes Turk-
cell’s human resources practices. In
particular, we give utmost importance
to increasing the number of wom-
en employees to enhance equality of
opportunity within our sector. In this
respect, we launched our “Women En-
gineer Employment” project targeting
women engineers, who are to begin
their career or whose career was in-
I wholeheartedly
believe that
our Company
will continue its
consistent growth
and become
more competitive
at the global
level with the
simplified
shareholder
structure and
thereby enhanced
decision-making
capability.
terrupted for various reasons. As part
of our recruitment activities to help
reverse brain drain, which is another
key consideration for us from a hu-
man resources perspective, we kicked
off the “Stars Coming Back” project in
2020, thus opening Turkcell’s doors to
Turkish professionals working abroad.
While we have created over 1,000
employment through the “GNÇYTNK”
program over the past 6 years, we also
implemented a new project in 2020 for
young people. Accordingly, we gave
10,010 university students and recent
graduates the opportunity to gain ex-
perience at Turkcell’s departments of
their choice via our “Unlimited Talent
Program”. As part of this mega pro-
ject, which we enabled online remote
access as the pioneer of digital trans-
formation, our young people had the
opportunity to engage in countless job
experiences from technology trainings
to personal development workshops,
networking and mentor support to
meeting with senior management and
award competitions. In order to create
stronger synergy, our artificial intelli-
gence systems grouped young people
according to their specific areas of
interest, whereby the participants had
the opportunity to fully utilize Turkey’s
most extensive experience project.
Although 2020 was a year that chal-
lenged organizations in terms of mac-
roeconomic and governance perspec-
tives, Turkcell became even stronger
with the developments realized
in
the last quarter of the year. The his-
torical decisions taken at our Gener-
al Assembly held in October with the
strong participation of our sharehold-
ers marked the start of a new era for
our Company. At the General Assem-
bly of Turkcell, which represents Turkey
in the international capital markets,
amendments to its articles of asso-
ciation were approved by the share-
holders. Turkey Wealth Fund became
the largest and controlling shareholder
with a 26.2% stake following the com-
pletion of share transfer transactions
subsequent to the General Assembly. I
wholeheartedly believe that our Com-
pany will continue its consistent growth
and become more competitive at the
global level with the simplified share-
holder structure and thereby enhanced
decision-making capability.
Turkcell, which is a significant value
for our country, is listed both at Borsa
Istanbul and the New York Stock Ex-
change for 20 years. It is our intention
to enhance the value created over
those 20 years to a higher level in the
upcoming periods, with the trust of our
domestic and foreign investors.
We carry out our activities with the
understanding that Turkcell’s participa-
tion in international platforms is valua-
ble for representation of our county in
the international arena. Thus, we will
be supportive of initiatives that serve
the good in the global arena. In this
respect, we were the only compa-
ny in Turkey responding to the call of
the United Nations in September 2020,
which celebrated its 75th anniversa-
ry this year. In order to overcome the
global crisis caused by the pandemic,
we signed the declaration that requires
demonstrating transparent and ethical
leadership as the public sector, civil
society and private sector, prioritizing
value-oriented strategies and acting in
cooperation with stakeholders to elim-
inate inequalities.
As Turkcell, one of our indispensable
priorities is to reach out and improve
lives through the power of technology
and communications, while providing
our customers the highest quality ser-
vice. We stood by our people in 2020
as we have done for the past 27 years,
with our social responsibility projects
focused on social benefits and re-
duction of
inequality. We touched
the lives of 200 thousand young and
disabled individuals with our Whiz
Kids and People Without Boundaries
projects that we have invested in for
many years in the education area. Our
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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About Turkcell
While developing
globally competitive
technologies, we
also attach great
importance to these
technologies being
people-oriented.
In this respect, we
established “the
Artificial Intelligence
Principles”, in a first
for Turkey.
becoming a carbon-neutral company,
the Green Loan we obtained to finance
those investments, as well as issuance
of human rights and environmental
policies were other important develop-
ments of this year. And so I am pleased
to present you with our integrated an-
nual report, one of the most valuable
outputs of these activities, and which
we prepared for the first time this year
so as to enable all our stakeholders,
especially our investors, to get to know
Turkcell better, and evaluate it from a
wider perspective.
I would like to extend my sincere grat-
itude to our customers, who have fur-
ther strengthened the Turkcell brand
with their appreciation under the chal-
lenging conditions of 2020, our share-
holders and investors, who have sup-
ported our Company with their trust,
all our employees, who have continued
to work with love and enthusiasm, de-
spite this unprecedented period in re-
cent history, and all our stakeholders.
Going forward, as Turkey’s Turkcell, we
will continue to work with the support
of all our stakeholders, and in accord-
ance with Turkcell’s ethical values and
focus on social benefit, to create value
for lives of our customers and the op-
erations of corporations.
Sincerely,
Bülent Aksu
Chairman of the Board of Directors
Dream Companion, My Sign Language
and My Gem Inside projects are the
best examples of how inequalities can
be reduced utilizing the power of tech-
nology. Following the earthquake, flood
and avalanche disasters we faced, we
mobilized our technology and commu-
nications power for our people in the
field. We marked a first in the world
with our Helping Hand project, which
we rapidly implemented over Payce-
ll platform after the flood disaster in
Giresun. We reached out to tradesmen
and families impacted by the flood,
and provided our support via Paycell. In
addition to the support provided by our
Company, “Turkcell Volunteers”, whose
entire income is generated via the do-
nations of Turkcell Group employees,
helped our people via the campaigns
initiated for Elâzığ, Giresun and İzmir.
We will continue to be at service of
Turkey, both with our technological
power and our social benefit projects,
as we have been for 27 years.
While developing globally competi-
tive technologies, we also attach great
importance to these technologies be-
ing people-oriented. In this respect,
we established “the Artificial Intelli-
gence Principles”, in a first for Turkey.
We shared our commitment to these
principles with the public via the arti-
ficial technologies we have developed.
Furthermore, we adapted a sustaina-
ble technology development approach
that is ethical, responsible and respect-
ful of human rights. Duly, our Human
Rights Policy states that we undertake
the mission of carefully observing the
governance processes of Artificial In-
telligence Principles.
As part of our sustainability activities,
one of our key focus areas, we took
important steps in 2020, and realizing
many firsts. We are truly proud of es-
tablishing our Integrated Value Crea-
tion Committee and improving our CDP
score, which we are regularly reporting
since 2015, from C- to B. Moreover, re-
newable energy investments towards
TURKCELL INTEGRATED ANNUAL REPORT 2020
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32
About Turkcell
Board of Directors
Board of Directors
Bülent Aksu
Chairman of the Board
Bülent Aksu has 25 years of manage-
of balance sheet and FX risk manage-
rial experience in finance, accounting,
ment along with his innovative solu-
tax and management fields in various
tions to funding investments. Mr. Aksu
sectors including telecommunications,
strengthened Turkcell’s leading posi-
energy, petrochemicals, textiles and
tion in local and international capital
audit. He began his career at Inspec-
markets having carried out first Asset
tion Board of Kuveyt Türk A.Ş. as an
Backed Securities (ABS) issuance in
Auditor, and then undertook Finance
non-banking sector, and having led
Manager and Group Finance Direc-
financing bill, lease certificate and
tor roles, respectively at Çalık Hold-
Eurobond transactions. In 2016 and
ing in 2003. Between 2008 and 2012,
2018, Mr. Aksu was voted among the
he served as CFO at Akfel Group. Mr.
top 50 most influential CFOs in Turkey
Aksu undertook CFO role at Azerbai-
by the Fortune Turkey magazine. Mr.
jani National Oil and Gas Company’s
(SOCAR) subsidiaries Petkim Petrok-
imya Holding A.Ş. and STAR Rafineri
Aksu served as Deputy Minister for the
Ministry of Treasury and Finance be-
tween August 3, 2018 and January 29,
A.Ş., respectively from 2012 to 2016.
2021. He served as a Board Member
Bülent Aksu carried out numerous
of Türk Telekomünikasyon A.Ş. from
mergers and acquisitions transac-
November 2018 to March 2019. Bülent
tions in various industries, and actively
Aksu served as a member of Turkcell
managed financial transactions in-
Board of Directors between March
cluding project financing and bond
2019 and March 2020. Between May
issuance in international and domes-
2019 and February 2021, he served as
tic markets. He led the completion of
the financing agreement of USD3.3
billion with 18 years maturity signed
the Chairman of Board of Directors of
Turk Eximbank. Mr. Aksu was appoint-
ed as the Chairman of Turkcell’s Board
between 23 local and international
of Directors effective as of March 12,
financial institutions and STAR Rafin-
2020. Mr. Aksu represented our coun-
eri, one of the most prominent indus-
try as Sherpa at the G20 summit in
trial investments of our country. This
2018, and as Turkey Governor at the
agreement had been the top project
Asian Development Bank (ADB) and
financing transaction made in Turkey
the African Development Bank (AfDB);
to that date in terms of amount and
Turkey Deputy Governor at the World
maturity. Moreover, it had been the
largest project financing transaction
Bank (WB), European Bank for Recon-
struction and Development (EBRD) and
in Europe in 2014. Bülent Aksu served
Asian Infrastructure Investment Bank
as CFO of Turkcell from July 20, 2016
to July 17, 2018. Mr. Aksu made valu-
able contributions to Turkcell having
(AIIB); as Turkey Executive Director at
Islamic Development Bank (IsDB) be-
tween August 2018 and January 2021.
implemented international practices
Bülent Aksu graduated from Istanbul
enabling Turkcell to become an exem-
University Faculty of Business Admin-
plary company of our country in terms
istration (English) in 1996.
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Hüseyin Aydın
Board Member
Hüseyin Aydın was born in 1959 in
served as General Manager of Halk-
Artvin, Borçka. He graduated from
bank between 2005 and 2011, when
the Ankara Academy of Economics
the bank went public in 2007 as the
and Commercial Sciences
(Facul-
biggest transaction of the country
ty of Economics) in 1981. He began
since then. Having joined Ziraat Bank
his career as an Assistant Auditor at
as the CEO on July 15, 2011, Mr. Aydın
Ziraat Bank and served as Auditor,
also serves as the Chairman of the
the Head of Department, Duisburg/
Banks Association of Turkey since
Germany Representative and Branch
2010 and Board Member of Turkey
Manager. After working as an Exec-
Wealth Fund Management Co since
utive Board member at Halkbank, as
2017. Hüseyin Aydın was appointed
a Board member at Pamukbank and
to the Turkcell Board of Directors on
as Deputy Chairman at Ziraat Bank
March 8, 2019.
between 2003 and 2005, Mr. Aydın
Afif Demirkıran
Independent Board Member
Afif Demirkıran was born in Siirt in
1952. Having completed his primary
and secondary education in Siirt, Afif
Demirkıran graduated from Mining
Deputy at the 23rd and 24th periods
of the Grand National Assembly Tur-
key. In the 22nd period, he also served
as a member of the State Economic
Faculty of Istanbul Technical Univer-
Commission for Enterprises, member
sity in 1973. Later he studied engi-
of Turkish Group OSCE PA and mem-
neering and had master’s degree at
the Leeds University in UK. He served
as an executive in Etibank, as Head
of Foreign Investment Department
at the Undersecretariat of State
Planning Organization, as General
Manager of Foreign Investment Di-
rectorate at the Undersecretariat of
Treasury, as a Board Member of Ere-
ber of the Turkey-EU Joint Parlia-
mentary Commission. In the 23rd and
24th periods, he was the President in
the Turkey-EU Joint Parliamentary
Commission. In the 22nd, 23rd and 24th
periods, he served as the Chairman
of Turkey-Spain Inter-Parliamentary
Friendship Group. In the 24th period,
he also was the Deputy Chairman of
gli Iron and Steel Inc. and Sümerbank
Turkey-Pakistan
Inter-Parliamentary
A.Ş., as various executive positions in
Friendship Group. Since 2016, he has
private sector companies, as Gener-
been the Deputy Chairman of Foreign
al Manager and Chairman of Turkish
Affairs Directorate of Justice and De-
Electricity Generation and Transmis-
velopment Party. Mr. Demirkıran was
sion Company (TEAŞ), and as General
appointed to the Turkcell Board of Di-
Manager of Vakıf Enerji ve Maden-
rectors by Capital Markets Board De-
cilik A.Ş.. Being active in politics
cision effective as of March 6, 2020.
since 2002, Afif Demirkıran served as
Batman Deputy in the 22nd, and Siirt
He is married and has four children.
Nail Olpak
Independent Board Member
Nail Olpak, was born in 1961 in İbe-
tees of the Foundation for the Sup-
cik, Burdur. He graduated from Aydın
port of İstanbul Medeniyet University,
High School. Having graduated from
Member of the Board of Trustees of
Istanbul Technical University Faculty
Kandilli Club. Nail Olpak also served as
of Mechanical Engineering, Mr. Olpak
the Chairman of MÜSİAD (Independ-
completed his master’s degree in the
ent Industrialists and Businessmen’s
field of Energy at Yıldız Technical Uni-
Association) and the Chairman of MÜ-
versity. Mr. Olpak serves as the Chair-
SİAD High Advisory Board, Vice-Chair-
man of the Board of NORA Elektrik
man of IBF (International Business Fo-
AS, PAK Yatirim AS and OMN AS and
rum), Council Member of B20 Steering
as the board member of companies
Committee of Turkey, Council Member
in which these three companies have
of İTO (Istanbul Chamber of Com-
shareholdings. As part of his activities
merce), Board Member of İDTM (Istan-
in NGOs and for public welfare; Mr.
bul World Trade Center), Board Mem-
Olpak serves as President & Chairman
ber of the Huzur Hospital Foundation,
of the Executive Board of DEİK, Board
Board Member of ENVERDER (Energy
Member of Export Credit Bank of Tur-
Efficiency Association), Member of
key (TURK EXIMBANK), Board Member
High Advisory Board and Board Mem-
of Turkcell, Board Member of İstanbul
ber of MMG (Architects and Engineers
Development Agency (İSTKA), Member
Group), Founding Committee Member
of High Advisory Board of MÜSİAD,
of Turkish-Japanese University, Mem-
Member of the Founding Committee
ber of the Board of Trustees of Com-
of International Technological, Eco-
mercialize Center Istanbul (CCI), Board
nomic and Social Research Founda-
Member of Turkey Silicon Valley. Mr.
tion (UTESAV), Member of the Board
Olpak was appointed to the Turkcell
of Trustees of Tourism Development
Board of Directors by Capital Markets
and Education Foundation of İstan-
Board Decision, effective as of March
bul Chamber of Commerce (TUGEV),
6, 2020. Nail Olpak was granted the
Member of Founders Board of İlim
title of Honorary PhD in the branch of
Yayma Foundation, Member of the
International Relations by Ahi Evran
Board of Trustees of Huzur Hospital
University and Mehmet Akif Ersoy Uni-
Foundation, Member of the Board of
versity. Olpak is married and is the
Trustees of Human Development and
father of two sons who are Architect
Societal Education Foundation (İG-
and Mechatronic Engineer. He speaks
ETEV), Member of the Board of Trus-
English very well.
Tahsin Yazar
Independent Board Member
Tahsin Yazar was born in İspir, Er-
Mr. Yazar was appointed as Advisor
zurum in 1975. He graduated from
to the Minister of Energy and Natu-
Ankara University Faculty of Law in
ral Resources on January 12, 2016. As
1996. After starting his career as a
of August 1, 2018, he was appointed
freelance lawyer, he continued at
as Advisor to the Minister of Treasury
Devres Law Office and Zorlu Hold-
and Finance and he held this position
ing A.S., respectively. Mr. Yazar joined
until the replacement of Minister. Mr.
Calik Holding Inc. in 2010 as Director
Yazar was appointed to the Turkcell
of Energy Group Legal Affairs and
Board of Directors as independent
also acted as a board member of
board member by decision taken by
Yesilirmak Electricity Distribution Inc.
the Capital Markets Board on March
and Aras Electricity Retail Sales Inc.
6, 2020.
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
36
Figen Kılıç
Board Member
Figen Kılıç, born in 1970 in Gaziantep,
manager for electronic ticket system
graduated from the Selçuk University,
integration and management proje-
Electrical Electronics Engineering de-
cts in various cities of Turkey. In 2014,
partment and received her Master’s
Figen Kılıç worked at Turkcell İletişim
Degree from the Gebze High Tech-
Hizmetleri A.Ş. and in 2015 was ap-
nology Institute. Trained in project
pointed to the Information and Com-
management, process management,
munication Technologies Authority
and test engineering, Kılıç also gra-
(ICTA) of Turkey as its first women
duated from the Anadolu University
board member. After her term in of-
Faculty of Open Education, Depart-
fice ended in 2019, she acted as Ser-
ment of Law, and is studying in the
vice Delivery General Manager of the
Department of Business Administrati-
Republic of Turkey Ministry of Family,
on of the same university. Figen Kılıç,
Labor and Social Services. Figen Kı-
started her career as technical trans-
lıç currently serves as Advisory Board
lator in İhlas Group, before moving to
Member of BİLTEG Group at TÜBİTAK,
İstanbul Municipality BELBİM A.Ş. for a
as a Board Member of ULAK Com-
lengthy period, working on payment
munications Inc. and as Chairwomen
projects as R&D engineer, Project Co-
of Kıbrıs Türk Denizcilik A.Ş. Figen Kılıç
ordinator and R&D Manager. In 2010,
was appointed to the Turkcell Board
she transferred to E-Kent Ödeme Sis-
of Directors, effective as of January
temleri A.Ş. (Çalık Holding) where she
29, 2021.
served as IT and Operational team
* Ms. Ingrid Maria Stenmark and Mr. Christopher James Powell, members of our Company’s Board of Directors, resigned from their duties as of October 22, 2020.
37
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020We took over this flag from those who sacrificed their lives forthe nation and those who held on to the flag even after martyrdom. Now it’s your turn to carry it with honor!Visit takeovertheflag.com and carry the crescent and star with honor.I am #TakingOverTheFlag From ThoseWho Bestowed This Soil a NationWE COMMEMORATE MUSTAFA KEMAL ATATURK AND OUR MARTYRS WITH GREAT RESPECT.HAPPY AUGUST 3Oth VICTORY DAY!MARTYR SANCAKTAR MEHMETCIK MEMORIALTHE BATTLE OF DUMLUPINAR SQUARE
38
Message from the CEO
Murat Erkan
Chief Executive Officer
Please see page 45 for detailed CV.
2020 was a year, in which COVID-19
We took several measures for our
Kids Laboratories opened with our
pandemic led to drastic changes in
employees and customers within the
support, and children could produce
economic and social terms worldwide,
context of the COVID-19 pandemic.
face shields for healthcare workers.
and transformed daily life and ways of
We implemented the remote work-
doing business. And as we met brand-
new concepts such as social distanc-
ing, remote working and distance
ing model prioritizing the health of
our employees since the first COV-
ID-19 case was detected thanks to
education, we also witnessed a rapid
our communication systems and in-
digital transformation in our lives. In
fact, all of these developments have
further underlined the importance of
formation technology
infrastructure.
Our remote working model also in-
cludes over 10 thousand call center
investments in communication infra-
employees. While the pandemic led
structures and technology. Today, it is
widely accepted that having a strong
telecommunication sector is the only
to increased data and digital services
usage, we have successfully managed
the resulting network traffic increase
way to ensure the successful trans-
through our strong telecommunication
formation of education, the business
infrastructure and our timely invest-
world and the wider economy in this
ments. During this period, we offered
new environment.
As the Turkcell family, we mobilized
our technology infrastructure, know-
how and experience so as to provide
our customers a high quality and unin-
terrupted communication experience
throughout 2020 operating period,
which was shaped by the COVID-19
pandemic. We benefitted from the
advantages of our leader position in
the sector in terms of digitalization,
and of investments in our infrastructure
over the years. Leveraging our strong
mobile and fixed infrastructures, we
successfully managed the increased
traffic on our network, while meeting
the changing demands of our custom-
ers without any difficulty. Indeed, our
digital services, digital business ser-
vices and techfin services successful-
ly met the rapidly rising digitalization
needs of our both consumer and cor-
porate segment customers.
support packages for customers aged
65 and above, healthcare workers and
students, and thereby stood by them.
We improved the connection quali-
ty of our fiber subscribers, who work
from home, or who continue their ed-
ucation remotely. In line with the in-
crease in time spent at home, interest
in our digital services also increased
accordingly. We provided additional
benefits in various services we pro-
vide through our rich portfolio of dig-
ital services. In cooperation with the
Ministry of Health, we created a BiP
channel where up to date COVID-19
information, measures and content are
shared. Turkcell customers aged 65
and over, who stayed at home, could
make a call to Paycell’s call center and
order basic food and cleaning agents
and pay through their bills. As part of
our social responsibility projects, we
provided new 3D printers to the Whiz
As customer behavior changed sig-
nificantly over the pandemic period,
online platforms saw increased us-
age for shopping. We also observed
strong rise in transaction volumes on
our website and Digital Operator ap-
plication, which are among our focus
areas and that we regularly develop.
While the number of visitors to digi-
tal sales channels reached 30 million
per month in 2020, the 3-month ac-
tive users of Digital Operator appli-
cation was 23 million. Online top-up
transaction volume realized over these
channels tripled on an annual basis. In
this context, the share of digital sales
channels in Turkcell Turkey consumer
revenues (excluding our fixed busi-
ness) reached 14.3% in fourth quarter
of 2020. Going forward, we will con-
tinue to focus on sales through digital
channels, which positively impacts our
operational costs. Another important
development of 2020 was the launch
of our
technological marketplace,
Turkcell Pasaj. Our customers can pur-
chase thousands of products including
smartphones, new generation tech-
nologies, household electrical appli-
ances, personal care products, gaming
computers, sports products, music and
hobby products from Turkey’s leading
suppliers with Turkcell assurance over
Turkcell Pasaj, which was developed
by Turkcell engineers.
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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In 2020, we
continued to serve
our customers
with our innovative
and inclusive
digital services
developed by
Turkish engineers.
Our standalone
digital services
revenue rose 26%
for the year. In a
period of increased
time spent at home,
we stood by our
customers with
our digital service
portfolio.
Our digital-oriented strategy
propositions, our subscriber base ex-
and strong business model led to
robust results
In 2020, all macroeconomic develop-
panded with net additions of 1.1 million
in 2020. Accordingly, despite the chal-
lenges of the pandemic, we achieved
ments were affected by the conse-
our target of adding 1 million subscrib-
quences of COVID-19 pandemic. The
ers in 2020.
economic activity in many sectors
came to a halt with the distortions in
the global supply chain and demand,
and also with increased unemploy-
ment. These developments eventually
led global economies to contract in
2020. Yet despite these conditions that
affected Turkey and our other coun-
tries of operation, we sustained our
successful operational and financial
performance in 2020, thanks to our
digital-oriented strategy and robust
business model. Turkcell’s consolidat-
ed revenues rose by 15.8% to TRY29.1
billion. Consolidated EBITDA increased
by 17.7% to TRY12.3 billion leading to
an EBITDA margin 42.2% on 0.7pp im-
provement. Our EBIT margin was 21.6%.
We registered a strong net income
performance of TRY4.2 billion on 30.5%
rise. Our operational capex to sales ra-
tio (excluding licenses) was realized at
18.5% in line with our plans. Moreover,
along with these solid set of results, on
the back of our strong balance sheet,
cash generation strength and profita-
ble operations, we distributed TRY812
million in dividends to our sharehold-
ers, which corresponds to the highest
rate permitted by legislation.
Despite the challenges of
the COVID-19 pandemic, we
strengthened our subscriber base
In a period, when the effects of the
pandemic were deeply felt, we stood
by our customers with our wide range
of offers, additional benefits and cam-
paigns that addressed the changing
customer needs through an innovative
and value creation focused approach.
In particular, we responded to the ris-
ing data usage demand via products
and services offered over our mobile
and fixed networks. Consequently, as
our customers appreciated our value
While our postpaid subscriber base
expanded strongly with 1.6 net annu-
al additions, the share of our postpaid
subscribers in total mobile subscribers
reached 66%. Mobile blended ARPU
(excluding M2M) rose 15.0% reach-
ing TRY49.1 driven mainly by growing
postpaid subscriber base, rising data
and digital service usage and upsell
efforts.
Demand for our fixed offers was also
strong in 2020, as our customers spent
more time at home. While we regis-
tered net 180 thousand fiber subscrib-
er additions, our total fixed subscriber
base exceeded 2.4 million. Residential
fiber ARPU rose by 9.2% to TRY70.9.
Superbox, our product offering unin-
terrupted household internet service
at fiber speeds over the mobile net-
work, became one of our most suc-
cessful products of 2020 amid rapidly
growing demand for fixed broadband.
In 2020, where the importance of fast
and high-quality household internet
service became ever clearer, Super-
box reached 591 thousand total sub-
scribers with 268 thousand net sub-
scriber additions, successfully meeting
strong customer demand. Our IPTV
subscriber base also rose to 871 thou-
sand subscribers with 152 thousand
net additions this year.
We met the rising digital needs of
our customers via our three strategic
focus areas
In 2020, we continued to serve our
customers with our innovative and
inclusive digital services developed
by Turkish engineers. Our standalone
digital services revenue rose 26% for
the year. In a period of increased time
spent at home, we stood by our cus-
tomers with our digital service portfo-
As the largest
data center
operator of
Turkey, we offered
our more than
1,600 corporate
customers the
opportunity to
manage their
data remotely,
supporting
their business
continuity.
lio. We made their time at home more
enjoyable by offering digital experi-
ence over TV+, fizy, lifebox and Dergi-
lik platforms, while enabling them to
make video calls with their loved ones
via BiP. We continued to develop our
digital portfolio by adding various new
features and services this year as well.
We also established separate compa-
nies for BiP, TV+, fizy and lifebox servic-
es marking a significant milestone for
their competition strategies. Through
our product, TV+ Ready, we offered
the opportunity to turn every television
into a smart TV thanks to the embed-
ded TV+ application. We introduced
the Turkcell Digital Security service to
address continuously rising internet
usage so as to ensure the security of
our consumer segment customers. We
also added the lifebox transfer service
to our portfolio, allowing users to eas-
ily and securely share files. We began
to offer YaaniMail e-mail service to our
corporate customers this year, provid-
ing uninterrupted service over our data
centers. Meanwhile, as remote work-
ing practices led to increased demand
for video conferencing, we developed
the BiP Meet application to meet this
need, and offered it to our customers.
We felt proud as 12th Ambassadors
Summit was held digitally over BiP
Meet, developed by Turkish engineers.
Moreover, we established a private
closed platform for ASELSAN over BiP,
ensuring that the intra-company cor-
respondence of around 8 thousand
employees is conducted securely. Re-
cently rising concerns over data priva-
cy resulted in greater demand for the
BiP application, where all user data is
stored at high security data centers of
Turkcell located in Turkey. In the first
two months of 2021, BiP registered 27
million new users. We continued to ex-
port the digital services we developed
in 2020. As part of our collaboration
with Digicel, our BiP, TV+, lifebox and
Fast Login services are currently being
used in 32 countries, including the Car-
ibbean, Central America and Pacific
regions.
The revenue of digital business servic-
es, one of our strategic focus areas,
and with which we accompany pri-
vate companies and public institutions
on their digital transformation journeys
increased by 30% in 2020. We suc-
cessfully met the increased demand
for new generation technologies such
as data center, cloud, cyber security,
managed services, system integration
projects, internet of things, large data
and business applications, in addition
to the conventional telecom services
in our portfolio. We took the lead in
corporate digital transformations by
being awarded over 2,300 projects
with a total contract value of TRY1
billion in 2020. Of these, 420 were
system integration projects for which
we provided end-to-end solutions.
We have a backlog in the amount of
TRY967 million from the system inte-
gration projects signed to date. As the
largest data center operator of Turkey,
we offered our more than 1,600 cor-
porate customers the opportunity to
manage their data remotely, support-
ing their business continuity. We put
into use the cloud section of Ankara
Temelli Data Center, Turkey’s largest
data center, launching “Government
Cloud” specifically designed for public
institutions. Meanwhile, having imple-
mented the technological infrastruc-
ture of 4 new hospitals in the health
sector, two of which are field hospi-
tals, we reached a bed capacity of
over 8 thousand at 9 hospitals in total,
also continuing our market leadership
of this sector. Additionally, this year,
we increased the number of glob-
al vendor partnerships to 21 through
strengthened cooperation. By further
increasing our competencies in this
field over the coming period, we will
remain the digital transformation part-
ner of corporations and become the
leader in the information technologies
market.
41
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
42
While
participating
in studies both
locally and at
the international
level towards
bringing the
technology of
the future to our
customers, we
work towards
making our
infrastructure
ready for the 5G
transition.
On the techfin front, our third strategic
billion free cash flow from our opera-
distance learning practices made the
toral NGOs, we feel the pride of rep-
the share transfer transactions com-
focus area, we helped our customers
to complete all their payment transac-
tions swiftly and securely via our new
tions in 2020. Thus, despite exchange
rate fluctuations, our net debt to EBIT-
DA ratio improved by 0.2x and de-
generation payment platform, Paycell,
clined to 0.8x by the end of the year.
importance of access to fiber connec-
resenting Turkey on international plat-
pleted in October. I consider this sig-
tions more apparent. Therefore, fiber
access, which is essential to the digital
transformation of our country and the
forms. Accordingly, we are among
the founding members of the United
Nations Global Compact CFO Task
nificant development that led to a
simplified shareholding structure to be
a milestone in Turkcell’s history. I also
in the pandemic period, during which
The foreign currency cash we hold and
transition to 5G technology, remains
Force, an initiative that guides the fi-
believe that our Company will contin-
payment habits changed and the de-
the derivatives instruments we use to
as a priority issue for our industry. As
nancial leaders of global companies
ue to deliver strong operational per-
mand for digital payment services
mitigate foreign currency risk support-
Turkcell, we believe in the need to
in the field of sustainable finance.
formance, and sustainable and prof-
rose. Our 3-month active subscribers
ed our strong net income performance.
rapidly implement a shared model in
We contributed to the drafting of the
itable growth in this new era entered
using the Paycell application, differen-
tiated by its ease of use and secure
payment infrastructure, reached 4.7
million. Thanks to the “Ready-to-use
Limit” feature added to Paycell in July,
users can spend their mobile payment
limits over their Paycell cards. Ready-
to-use-Limit reached 190 thousand in-
dividual users and a total volume of
TRY85 million by the end of the year.
The transaction volume on the Payce-
ll card more than doubled compared
to the same period of the previous
year. Digital content purchases rose by
70% compared to the previous year to
TRY84 million per month. In 2020, we
took an important step to ensure that
the 24/7 money transfer service to the
IBAN numbers of contracted banks.
We also added the mobile POS prod-
uct this year to the Paycell merchant
solutions. Having been registered by
the Ministry of Treasury and Finance
and the Revenue Administration, Pay-
cell Android POS offers cost and ef-
ficiency advantages to member mer-
chants, while providing the processes
inventory monitoring
of collection,
and e-invoice over a single platform.
Moreover, the total sapling donation
to the Paycell Forest project, which we
implemented as part of the Breath to
the Future project of the Ministry of
Agriculture and Forestry, exceeded 11
thousand.
We continued to generate cash
Thanks to our strong operational per-
formance, disciplined cost manage-
ment practices, and effective working
capital management and efficient
capex planning, we generated TRY3.4
We continued to invest in projects
that will drive the future
One of the major topics of the up-
coming period will be 5G technology.
Having commenced use in over 60
countries, 5G technology will play an
important role in the digital transfor-
mation of institutions and sectors with
the novel services it has to offer. While
participating in studies both locally
and at the international level towards
bringing the technology of the future
to our customers, we work towards
making our infrastructure ready for
the 5G transition. Within this frame-
work, we take part in a diversity of 5G
projects of international technological
organizations such as those of NGMN,
GSMA, and ITU. Additionally, this year,
we also continued our support for the
“End-to-End Domestic and National
5G Communication Network Project”
established under the leadership of
the Information and Communication
Technologies Authority and with the
support of TÜBİTAK, together with
Communication Technologies Cluster
firms.
During the pandemic period, our cus-
tomers’ need for fast and high-quality
Wi-Fi service increased. We signifi-
cantly improved indoor internet cov-
erage through the Wi-Fi 6 technology
that we implemented this year, and
initially used in households in Turkey.
Duly, we ensured internet usage of
uniform quality throughout the home
by preventing speed cuts caused by
building structure.
The increased time spent at home, and
the adaptation of remote working and
infrastructure investments so as to op-
Principles for Integrated Sustainable
into with Turkey Wealth Fund, which
timize use of our country’s resources. In
Development Goals Investments and
expressed its confidence in, and sup-
this respect, we believe that instead of
Finance together with 42 internation-
port for our strategy on all platforms.
competing on infrastructure, we could
al companies from diverse sectors.
invest our resources in services and
projects, which could create greater
value for our country.
We focused on our
sustainability activities
As Turkcell, we attach priority to cre-
ating sustainable value, realizing social
responsibility projects and leveraging
the power of technology and com-
These principles were announced to
the world at the 75th session of the
UN General Assembly meeting held
in New York in September. Moreover,
registering a first in the sector, we of-
fered our employees GSMA “Sustaina-
ble Business Development in the Mo-
bile Sector” online training.
And so in leaving 2020 behind, a year
that emphasized communication and
technology as being an indispensa-
ble human right, I wish to thank all
our employees for their contribution to
our success, and our Board of Direc-
tors for their confidence and support.
I would like to express gratitude to our
customers and business partners who
We continued to utilize sustainability
have remained with us throughout our
munication to create social bene-
financing instruments this year as well.
success story.
fit. The educational projects that we
In this context, we signed a 5-year
conduct leveraging our technological
maturity EUR50 million green loan fi-
competencies with a commitment to
equal opportunities, support achiev-
ing Sustainable Development Goals. In
nancing agreement with ING Bank.
This agreement marks the longest ma-
turity corporate green loan agreement
this respect, as part of People with-
thus far signed in Turkey. We plan to
out Boundaries project, we continue
utilize the credit for the financing of
to offer diverse solutions to people
our sustainable investments.
While celebrating the 20th anniversary
of being listed on both Borsa Istanbul
and the New York Stock Exchange, we
are to pioneer our sector adapting a
new reporting structure. I am, there-
fore, delighted to present to you, our
valuable stakeholders, the first Inte-
grated Report of Turkcell and of our
with disabilities enabling them the
opportunity to participate in daily life
equally. We support the education of
students with our Whiz Kids project
that makes a difference with its rich
content, while we raise awareness
regarding electronic waste via our
Recycle into Education project. Going
forward, we will continue to leverage
technology to support our people in
realizing their potential, to eliminate
social barriers and to ensure social
equality of opportunity.
We view national and international
non-governmental organizations as
among the most valuable business
partners in our ecosystem. In this re-
gard, while carrying out projects in
cooperation with national and sec-
The importance we attach to human
sector. As Turkcell senior management,
resources has been one of the signifi-
we have paid the utmost attention to
cant values of Turkcell since its estab-
implementing IIRC Framework require-
lishment. While making an investment
into the intellectual capital and local
development of our country via the
ments, in preparing our 2020 integrat-
ed annual report. Accordingly, we are
proud to present our first integrated
“Stars Are Back” recruitment project,
report to you, our valuable stakehold-
we offered 10,010 university students
ers. I firmly hope that 2021 becomes a
and new graduates the opportunity to
year in which we all look to the future
gain experience at Turkcell and steer
in good health and confidence.
their future through the “Unlimited Tal-
Sincerely,
ent Program”.
A new era began for Turkcell with
simplification of its shareholding
structure
Turkey Wealth Fund became the larg-
est and controlling shareholder of our
Company with a 26.2% stake through
Murat Erkan
Chief Executive Officer
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
44
About Turkcell
Executive Officers
Executive Officers
05:32
Murat Erkan
Osman Yılmaz
Serhat Demir
Kadri Özdal
Ceyhun Özata
Fatih Alper Ergenekon
Ataç Tansuğ
Serkan Öztürk
Gediz Sezgin
Ali Türk
Murat Erkan
Chief Executive Officer
Murat Erkan was appointed as Turk-
fense industry and industrial products
cell Chief Executive Officer on March
sectors starting from 2006. Murat
15, 2019. Mr. Erkan, who started his ca-
Erkan joined Turkcell Group in June
reer at Toshiba, worked as an Appli-
2008 as the General Manager of
cation Engineer at Biltam Mühendislik
Turkcell Superonline, and he assumed
and then served as the first “System
the role of Executive Vice President of
Engineer” of Turkey at Cisco Turkey. He
Sales from December 2015 to March
served as Chief Officer at Cisco Sys-
2019. Murat Erkan graduated from
tems in charge of Technology, Sales,
Yıldız Technical University Electronics
Business development and Channel
and Telecommunication Engineering
Management. Mr. Erkan served as the
Department. He completed the Stra-
Business Unit Manager at Aneltech
tegic Marketing Program at Harvard
working on solutions related to tele-
Business School in 2010.
communications, mobile, ICT, the de-
Osman Yılmaz
Executive Vice President
Finance (CFO)
Osman Yılmaz was appointed as
Asset Management. In August 2016,
Turkcell Chief Financial Officer on
he joined Turkcell family as Director
August 1, 2018. Mr. Yılmaz started
of Treasury, Risk and Collection Man-
his professional career at Türkiye
agement. Mr. Yılmaz holds a dual BSc
İş Bankası Treasury Department in
degree in Economics and Manage-
2006. In 2007, he worked at BNP/
TEB Treasury Department. From 2008
ment from London School of Eco-
nomics and Istanbul Bilgi University,
to 2016, he served as Senior Fund
MSc in Financial Engineering from
Manager in Structured Products and
Boğaziçi University and a PhD in Fi-
Group Head of Fixed Income and
nance from Özyeğin University.
Multi Asset Funds at HSBC Global
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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46
Serhat Demir
Executive Vice President
Legal and Regulation
Serhat Demir joined Turkcell as the
Between 2009 and 2015, Mr. Demir
Executive Vice President of Legal and
undertook Çalık Holding Legal Affairs
Regulation Function on May 18, 2015.
Director role and in the meantime
In addition to his current role, he has
he also served as member of Board
been also serving as acting Executive
of Directors at holding level and at
Vice President of Human Resources
group companies that operated in
since March 16, 2020. Mr. Demir start-
telecom and finance fields in Turkey
ed his professional career in 1997 at
and abroad. Serhat Demir graduated
Dun & Bradstreet Turkey office. From
from the Faculty of Law at Istanbul
2003 to 2007 he worked at Yıldız
University. He received his MBA de-
Holding Legal Consultancy Depart-
gree from Fatih University and com-
ment and in 2007 he served as the
pleted Executive Education Program
Legal Counsel at Çalık Holding A.Ş.
at Harvard Law School.
Kadri Özdal
Executive Vice President
Consumer Sales
Kadri Özdal was appointed as the
Özdal took part in foundation and
Executive Vice President of Con-
management of n11.com which is one
sumer Sales on September 26, 2019.
of the largest e-commerce platforms
He started his professional career
in Turkey and held CSO role. In Feb-
at Vodafone in 1999 and worked in
ruary 2016, he joined Turkcell as Al-
sales, marketing and commercial op-
erations departments. He then joined
ternative Sales Channels Director and
managed non-exclusive and digital
Turk Telekom and held positions in
sales channels, finally having served
sales development, channel optimi-
as Retail Channels Sales Director.
zation and management functions.
Kadri Özdal graduated from Dokuz
He served as sales development di-
Eylül University, Faculty of Economics
rector and then as CSO from 2011 to
and Administrative Sciences, Depart-
2012. Between 2012 and 2016, Kadri
ment of Public Administration.
Ceyhun Özata
Executive Vice President
Corporate and Residential Sales
Ceyhun Özata was appointed as the
Direct Sales Director, and Marketing
Executive Vice President of Corporate
Director positions at Turkcell Superon-
and Residential Sales on September
line. From 2008 to 2015, he served as
26, 2019. He started his professional
the Vice President of Retail Sales at
career at Reuters and worked as a
Turkcell Superonline which acceler-
Customer Advisor from 1995 to 1996.
ated fiber infrastructure investments.
He held Assistant Manager of Cus-
Lastly, he served as the Sales Director
tomer Operations role at Superonline
of Turkcell Residential and Small Me-
from 1996 to 1999. He served as a CRM
dium Business Management starting
and Product Management Manager
from 2015 until his most recent as-
at IXIR AŞ from 1999 to 2001. Starting
signment. Ceyhun Özata graduated
from 2002, Özata held Project Man-
from Boğaziçi University, Department
ager, Online Sales Manager, CRM &
of Electronics.
Fatih Alper Ergenekon
Executive Vice President
Marketing
Fatih Alper Ergenekon, was appoint-
headquarters in Memphis, Tennessee
ed as the Executive Vice President
between 2002-2005. He joined the
of Marketing on April 29, 2020. He
Marketing Department of Turkcell in
started his professional career as
2005 and was appointed as Market-
a project manager at OTA NGO in
ing Manager in 2006 and Marketing
Berlin, Germany in 1996. He worked
as a consultant at I-BIMSA between
Director in 2010. Lastly, he served as
Strategy Director starting from Sep-
1997-2000. After getting his Master
tember 2018. Fatih Alper Ergenekon
of Business Administration degree
received his Bachelor’s degree in In-
from the University of Rochester, New
dustrial Engineering from the Middle
York in 2002, he worked as a Senior
East Technical University in 1996.
Marketing Specialist at FedEx USA
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
48
Ataç Tansuğ
Executive Vice President
Digital Services and Solutions
Ataç Tansuğ was appointed as the
baijan and Global Customer Service
Executive Vice President of Digital
Director role in his last two years in the
Services and Solutions on September
company. He joined Turkcell Group as
26, 2019. Mr. Tansuğ started his pro-
the Chief Technology Officer of Turk-
fessional career as System Support
cell Superonline in 2013. Later he was
Engineer at Datapro in 1999. Between
appointed as Transmission & Core
2002 and 2009, he served as Interna-
Network Planning Director at Turkcell
tional NGN/IMS Service Support En-
in 2016. Lastly, he held Digital Services
gineer, Team Leader and Team Man-
& Solutions Technology Director po-
ager in Alcatel-Lucent. From 2009 to
sition at Turkcell. He graduated from
2011, he held Product Service Director
the Department of Civil Engineering at
role responsible for Turkey and Azer-
Boğaziçi University.
Serkan Öztürk
Executive Vice President
Information and Communication Technologies
Serkan Öztürk was appointed as the
as Chief
Information Technologies
Executive Vice President of Informa-
Officer in life-Ukraine between 2009
tion and Communication Technologies
in September 2015. Between 2017 and
2019, he also served as the Executive
Vice President of Customer Experi-
ence in addition to his existing role.
Serkan Öztürk joined Turkcell in 2000
as a Project Supervisor. He worked as
and 2010 and in Turkcell Superonline
between 2010 and 2011. From 2011 to
2015 he served as Turkcell Customer
Relations Management and Business
Intelligence Solutions (CRM & BIS) Di-
rector. Serkan Öztürk graduated from
Middle East Technical University Elec-
project supervisor and manager at
trical and Electronics Engineering de-
Turkcell Project Management Office
partment. He received his MBA degree
between 2000 and 2009. He served
from Istanbul University.
Gediz Sezgin
Executive Vice President
Network Technologies
Gediz Sezgin joined Turkcell as a
vice Network under the ICT Function
Network Engineer in 1995. In Octo-
and held various executive positions
ber 2015, he was appointed as the
in the Technology Function. Mr. Sezgin
Executive Vice President of Network
started his career at Alcatel Teletaş in
Technologies. Previously, he served as
1991. He graduated from Istanbul Tech-
Senior Vice President of Information
nical University Electronics and Com-
and Communication Technologies,
munication Engineering Department
Chief Information and Communication
and received his Master’s Degree and
Technologies Officer, Director of Ap-
PhD from the same university.
plication Operations, Director of Ser-
Ali Türk
Executive Vice President
Supply Chain Management
Ali Türk joined Turkcell as the Senior
he worked at Ceva Lojistik as Ware-
Vice President of Supply Chain Man-
house and Value Added Operations
agement in May 2016. He was ap-
pointed as the Executive Vice Presi-
Group Manager. Mr. Türk joined Turk-
ish Airlines in 2011 as Cargo Operations
dent of Supply Chain Management in
March 2017. Mr. Türk started his career
at Başak Hayat Sigorta in 1999. From
Vice President. He was appointed
as Turkish Airlines Cargo Operations
President in 2012. Ali Türk graduated
2002 to 2007, he held various mana-
from Istanbul Technical University In-
gerial positions responsible for logis-
tics planning, warehouse and supply
chain management processes at Ülker
Group companies. From 2007 to 2011,
dustrial Engineering Department and
completed Executive MBA program of
Istanbul Technical University
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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About Turkcell
Top Management
of Subsidiaries
Murat Erkan
Chief Executive Officer
Please see page 45 for detailed CV.
İsmet Yazıcı
General Manager of
lifecell Ukraine
İsmet Yazıcı joined Turkcell in 2009.
al Sales Engineer, Romania Country
Mr. Yazıcı has been serving as the
Manager, Product Marketing Man-
General Manager of lifecell, Turkcell’s
ager, EMEA Region CDMA Business
subsidiary in Ukraine, since May 2017.
Development Director, and Enterprise
Prior to this position, Yazıcı worked
Leader, respectively, at the Turkey
as the Deputy General Manager of
and USA offices of Nortel until 2009.
Sales and Business Development at
Global Tower between 2009 and
İsmet Yazıcı received his bachelor’s
degree in Electrical-Electronics En-
2010. He served as the General Man-
gineering from Hacettepe University
ager of Global Tower between 2010
in 1992, and his postgraduate degree
and 2011. From 2011 to 2015, he served
in Political Science from Marmara
as the General Manager at BeST,
University in 1998 and in Internation-
Turkcell’s subsidiary in Belarus, and
al Marketing and Management from
as General Manager at Kuzey Kıbrıs
the University of Texas in 2001. In 2011,
Turkcell between 2015 and 2017. Be-
he received his second undergradu-
ginning his professional career in
ate degree from Istanbul University,
1993, Yazıcı served as the Research &
Faculty of Law.
Development Engineer, Internation-
Erdal Yayla
General Manager of BeST
BeST General Manager Erdal Yayla
ager role starting from November
joined Turkcell İletişim Hizmetleri A.Ş.
2018 until March 2020 in addition to
as a Financial Controller & Reporting
his existing responsibility. Mr. Yay-
Specialist in 2003. He served as the
la serves as BeST General Manager
Manager of Financial Accounting,
since March 2020. Mr. Yayla start-
Controlling and Reporting Depart-
ed his career as a Senior Auditor at
ment (2004-2010), Deputy General
PricewaterhouseCoopers in 1999, and
Manager of Finance (2010-2016) and
then worked as a Financial Controller
Acting General Manager (2014-2015),
at LafargeHolcim in 2002. Erdal Yayla
respectively at lifecell, Turkcell’s sub-
graduated from Marmara University
sidiary in Ukraine. He served as the
Faculty of Economics and Adminis-
Deputy General Manager of Finance
trative Sciences in 1999 and complet-
at BeST, Turkcell’s subsidiary in Bela-
ed the Executive Development Pro-
rus, starting from March 2016, and he
gram at Wharton School in 2016.
assumed the Acting General Man-
Çağatay Aynur
General Manager of
Turkcell Global Bilgi
Çağatay Aynur joined Turkcell Group
Corporate Sales Director in charge of
in 2000. On July 1, 2015, he was ap-
Large Scale Businesses and Corpo-
pointed as the General Manager of
rate Sales Director in charge of Mid-
Turkcell Global Bilgi. Prior to this role,
Scale Businesses at Turkcell. Mr. Aynur
he served as the Regional Manag-
graduated from Department of Met-
er in charge of Strategic Customers
allurgical Engineering at Middle East
and Public Affairs, Sales Manager in
charge of Large Scale Businesses,
Technical University in 1993.
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About Turkcell
Z. Korhan Bilek
General Manager of
Turkcell Finansman
Korhan Bilek joined Turkcell team as
fourSA Turkey between 2011 and 2016.
Investor Relations and Mergers&Ac-
He began his professional life as Re-
quisitions Director in November 2016,
search Analyst at the Federal Reserve
and was appointed as Treasury and
Bank. He served as an analyst at Ak-
Capital Markets Management Direc-
Invest between 2002 and 2004 and
tor in December 2018. Since July 2020,
Finance Director at Sabancı Holding
he serves as Turkcell Finansman AŞ
between 2004 and 2013. Korhan Bilek
General Manager and Board Member.
has a M.S. degree from Boğaziçi Uni-
Prior to Turkcell, he worked as CFO at
versity Electrical and Electronics Engi-
Teknosa for 3 years and was a mem-
neering department, and received his
ber of the Board of Directors at Carre-
MBA from University of Rochester.
Melike Kara
General Manager of Turkcell Payment
and Electronic Money Services
Melike Kara, worked as a manager
Business Administration in 2004 and
in Turkcell Mobile Financial Servic-
began working at Pricewaterhouse-
es Department from 2011 to 2015. In
Coopers Istanbul Office the same
February 2015, Ms. Kara was appoint-
ed as Turkcell Ödeme ve Elektronik
year. After 2 years of PwC experience,
she held various positions in the field
Para Hizmetleri A.Ş. General Manager.
of marketing and business develop-
Kara graduated from the Middle East
ment within Garanti Bank Payment
Technical University Department of
Services business line.
Murat Küçüközdemir
General Manager of Kuzey Kıbrıs
Turkcell (Acting)
Murat Küçüközdemir graduated from
the Turkcell family in 2011 after the
İstanbul Technical University, Depart-
acquisition of Global İletişim by Turk-
ment of Electronics and Communi-
cell Group, worked as Data Center
cation Engineering in 1992. He start-
and Cloud Information Technologies
ed his professional life in 1993 and
Consultant, Corporate Fixed Products
assumed technical and managerial
Marketing Director and Public Sales
roles at Telemesaj A.Ş., İntelnet A.Ş.
Director at Turkcell. In April 1, 2019 he
and Elkotek A.Ş. companies up un-
was appointed as the Sales & Mar-
til 2005. He continued his career as
keting Director of Kuzey Kıbrıs Turkcell
the General Manager of Gisad Tel-
and effective from February 1, 2021 he
ekom A.Ş. between 2005 and 2007.
has become the Acting General Man-
Between 2007 and 2011, he worked
ager. He completed Insead Business
as Assistant General Manager and
School Leadership Development and
General Manager at Global İletişim
IMD Business School Global Leader-
A.Ş.. Murat Küçüközdemir, who joined
ship programs.
Erkin Kılınç
General Manager of
Turkcell Energy Solutions
Erkin Kılınç joined Turkcell Energy Solu-
at Akfel Group (2009-2011), as Turkey
tions as the General Manager in 2017.
Sales Director at RWE (2011-2015) and
Kılınç began his career at Ode Insula-
as Assistant General Manager at Li-
tion as Sales Specialist in 1998. Subse-
quently, he served as Sales Specialist
mak Energy (2015-2017). Erkin Kılınç
received his bachelor’s degree in Me-
at Doğan Foreign Trade&Agency Op-
chanical Engineering from
Istanbul
erations (2001-2003), as Energy Trade
Technical University in 1998, and Exec-
Group Manager at Akenerji (2003-
utive MBA degree from Işık University
2009), as Energy Projects Coordinator
in 2003.
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Kaan Turan
General Manager of Turkcell
Digital Business Services
Kaan Turan joined Turkcell Group in
Services and Solutions Management
2013. He serves as the General Man-
Executive in ATOS Turkey, as Global
ager of Turkcell Digital Business Ser-
Large Deals Solution Director in Sie-
vices since March 1, 2020. Prior to that
mens AG Germany, as Service Factory
role he worked as System Integration
Operations Manager, as Knowledge
and IT Services Manager, Digital Inte-
Manager and as IT Architect Consult-
gration & IT Solutions Director, Strate-
ant in Siemens Turkey, respectively.
gic Partnership & Business Develop-
Kaan Turan graduated from Middle
ment Director and finally acting Gen-
East Technical University, Department
eral Manager of Turkcell Digital Busi-
of Electrical – Electronics Engineering
ness Services in Turkcell. Before join-
in 2000.
ing Turkcell he worked as Managed
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About TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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About Turkcell
About the report
We are proud to
present Turkcell’s first
integrated report,
reflecting Turkcell’s
corporate reporting
approach and focus
on value creation, for
the attention of our
stakeholders. Going
forward, we aim to
present our economic,
social, environmental,
and corporate
governance approach,
strategy, business
model, value creation
process, performance,
and sustainable
business focus together
on an annual basis
reflecting the principles
of transparency and
accuracy.
Turkcell 2020 Integrated Annual Re-
port has been prepared in accordance
with Turkish Commercial Code and
Capital Markets Board’s “Communiqué
on Principles Regarding Financial Re-
porting in the Capital Markets” (“Com-
muniqué”) No. II.14.1. The report has also
been prepared with the guidance of
the International Integrated Reporting
(IR) Framework of the International In-
tegrated Reporting Council (IIRC). With
its 2020 Integrated Annual Report,
Turkcell aims to present an assessment
to all stakeholders of its sustainable
value creation activities
integrated
with its expertise and management
capabilities. The value creation focus
presented in this report includes Turk-
cell’s assets, the resources required to
implement its strategies and achieve
its goals, and its approach to manag-
ing its capitals and policies. As stat-
ed in the Framework of IIRC, the
report content has been designed
around six capitals. Meanwhile, a ma-
teriality approach has been adopted
by canvassing the views of key stake-
holders in creating the content and
structure of the integrated report, and
also to support the effective imple-
mentation of Turkcell’s IR strategy.
The terms “Turkcell” and “Company”
in the report represent Turkcell İletişim
Hizmetleri A.Ş. Our report covers the
activities realized between 1 January
2020 – 31 December 2020, in accord-
ance with the “Core” option of the
Global Reporting Initiative (GRI).
Please refer to the Glossary
section of the report for the
explanation of abbreviations
and technical definitions used
in the report.
investors
This report aims to address the infor-
mation requirements primarily of our
long-term
(shareholders,
bondholders, and potential investors).
In addition, it provides information
that goes beyond financial report-
ing to encompass all other Turkcell
stakeholders, including Turkcell em-
ployees, customers, public institutions
and organizations, and non-govern-
mental organizations.
SDG 12.6
Turkcell 2020 Integrated Annual Re-
port is also a communication of pro-
gress report of the United Nations
Global Compact, to which Turkcell
has been a signatory since 2007.
Through the 2020 Turkcell
Integrated Annual Report you
can follow the Sustainable
Development Goals and
Objectives, to which our
operations contribute, with the
Sustainable Development Goal
and Target icons next to the text.
Turkcell 2020 Integrated Annual Re-
port has been prepared based upon
the “Comply or Explain” principle of the
Sustainability Principles Compliance
Framework, which entered into force
on October 2, 2020 with the amend-
ment made to the Corporate Gov-
ernance Communiqué by the Capital
Markets Board of Turkey. You may fol-
low the list of relevant report sections
regarding the items included in the
Sustainability Principles Compliance
Framework in the Annex-7 Sustaina-
bility Compliance Framework table
of this report. In leveraging its strong
corporate structure, Turkcell gives ut-
most importance to the feedback
and suggestions received from its
stakeholders as part of its value cre-
ation journey in its home country and
sector. You may submit all your opin-
ions, questions, and feedback on our
report to dahaiyibirdunya@turkcell.com.tr
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About Turkcell
Value
creating
creating
Turkcell
Value creating Turkcell:
Technology for life, hope for the future
Sustainability strategy
60
62
63
Our value creation process and business model
66
Strategic focus areas and business operations
72
76
Interactions with our stakeholders
Measuring the value created
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Value creating Turkcell
Strengthening our
capitals with our core
competencies, we
use our value creation
model to inform our
stakeholders on the
value Turkcell creates
for our country, society,
the regions where
we carry out our
operations, and for all
our stakeholders.
With 27 years full of achievements
behind us, as Turkey’s Turkcell, we aim
to introduce the latest technologies to
our country and people through our
infrastructure and technology invest-
ments, contribute to the digital trans-
formation of Turkey and enrich every
moment for our customers through
our value-added services and solu-
tions. We have been working to cre-
ate value for all our stakeholders in
Turkey and other countries since our
establishment. Our corporate identity
as a responsible technology company
and our sustainable activities allow us
to shape our business model in light
of trends that impact society and
our sector, as well as feedback from
the stakeholders in our value-chain.
We closely monitor our main capi-
tals, the value that we create, and our
social contribution, which we enrich
through our business operations and
core competencies, via tangible and
measurable performance indicators.
Strengthening our capitals with our
core competencies, we use our value
creation model to inform our stake-
holders on the value Turkcell creates
for our country, society, the regions
where we carry out our operations,
and for all our stakeholders. As part
of our focus on continuous devel-
opment and progress, we establish
our value creation model under our
main capitals, which are inputs to
our operations, and we present it for
the first time this year from the val-
ue-creation perspective of integrat-
ed management. We empower the
Turkcell sustainability strategy, which
is among the key components of our
value creation model, by establish-
ing connectivity between those in-
puts and our strategic focus areas
and core competencies, and focus
on managing the value we create,
reduce and transform across capitals.
Value creating Turkcell: Technology
for life, hope for the future
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As Turkcell, our main goal is to be
the leader in every activity we car-
ry out. Therefore, we have started
to use integrated reporting as our
main corporate reporting tool as of
2020, to transparently and compre-
hensively present the environmental,
social, and corporate
information
demanded by our investors and key
stakeholders, and to maintain our
Turkcell’s first
integrated annual
report aims to
disclose the integrated
value creation and
transformation process
in a comprehensive
way in line with
the principles of
transparency and
accuracy, for all
stakeholders and in
particular for investors.
leader and pioneer position in the
inter-
sector by closely following
national trends and best practices.
In this respect, we aim to commu-
nicate the value that we create to
our stakeholders not only from a fi-
nancial perspective, but also from
social and environmental perspec-
tives more
through
reporting model.
the
transparently
integrated
Value creating TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
62
Value creating Turkcell
Sustainability strategy
Adaptation of
Sustainability and its
policies by all Turkcell
employees, feature
among the Company’s
strategic goals, and
are assigned as Key
Performance Indicators
for everyone from the
Chief Executive Officer
to employees.
activities have been initiated to ensure
that all employees will receive train-
ing on Sustainability and ESG policies.
In 2021, inclusive sustainability goals,
which include renewable energy use
and installation, increasing women’s
employment, compliance of suppli-
ers from environmental, social and
governance perspectives, the recy-
cling of waste, and adaptation of
Sustainability and its policies by all
Turkcell employees, feature among
the Company’s strategic goals, and
are assigned as Key Performance In-
dicators for everyone from the Chief
to employees.
Executive Officer
Our Company’s ESG Key Perfor-
mance Indicators (KPI) such as gen-
der equality, use of renewable energy,
and employee training are included
in our sustainability report, which we
have published since 2011. These Key
Performance Indicators are subject
to BIST SI (Borsa Istanbul Sustain-
Index) and CDP evaluation.
ability
We continue to establish systems to
closely monitor sub-parameters re-
lated to ESG Key Performance In-
dicators. When the respective data
can be verified, we present such KPIs
together with local and internation-
al sector benchmarks as part of our
Sustainability Committee activities.
You can access more information
on our strategic focus areas,
core competencies and business
strategies in the “strategic
initiatives” section of the report.
Our value creation process and business model
Keeping in mind
the importance of
sustainability initiatives
for our country and
the world we live
in, we carry out our
activities to increase
our social contribution,
reduce our negative
environmental impact
and offer innovative
solutions to our
customers.
As a signatory to numerous
international principles and
programs such as UNGC, United
Nations Women Empowerment
Principles (UN WEPs), and GSMA’s
Digital Declaration on Climate
Change, we closely follow global
developments in sustainability,
taking the best practices in the
field as a reference.
SDG 12.6
You can access more
information on the sustainability
initiatives that we have signed
or contributed to in the section
presenting the measurement of
value created.
We have a significant potential for
sustainable value-creation as one of
the leading players in the telecommu-
nications sector. The telecommunica-
tions sector has the potential to save
10 times more carbon emissions than
its own carbon footprint thanks to the
innovative solutions provided to cus-
tomers. Furthermore, mobile technol-
ogies offer great benefits for equality
of opportunities among societies, and
for access to financial, health and ed-
ucation services by expanding smart-
phone and broadband penetration,
thereby providing access to various
online services such as online banking.
We enhanced Turkcell’s existing sus-
tainability strategy in 2020 to create
long-term value for our society. In this
respect, we integrated Turkcell’s supe-
rior digital services, deep experience
in the sector, core competencies, fo-
cus on the Sustainable Development
Goals and the high growth potential of
our sector into the strategy. Turkcell’s
sustainability strategy has been de-
veloped in accordance with our stra-
tegic focus areas and business strat-
egy, by considering the sustainability
potential of the telecommunications
sector. We integrate our sustainability
strategy into our business operations
by carrying out activities under three
main sustainability focus areas, “com-
bating climate change with the power
of technology”, “accessible and inclu-
sive services focused on human hap-
piness” and “being a good corporate
citizen”, and we implement practices
with regards to these focus areas.
Relevant units of our Company re-
ceived sustainability and human rights
trainings from GSMA in 2020. In 2021,
As part of our 2020
integrated annual
report, we designed
Turkcell’s value
creation process to
tangibly measure
the value-created
and transparently
communicate it to our
stakeholders. Within
the framework of
value creation model,
we present the main
capitals of Turkcell via
performance indicators
that are enriched
by its business
operations and core
competencies.
The six capital-based approach
specified in the IIRC Integrated Re-
porting Framework has been adopt-
ed in establishing our value creation
process. In the development of our
value creation process, we organized
integrated thinking focused meet-
ings and workshops with various
departments of our Company to re-
flect their activities and capture their
interactions with other divisions in
light of Turkcell’s strategic focus ar-
eas, sustainability strategy and core
competencies. We have identified
the global and local trends, risks and
opportunities that have the potential
to impact our value creation pro-
cess, and thus our business activities.
As Turkcell, we conduct our activi-
ties not in isolation, but in connection
with the stakeholders in our ecosys-
tem. In this respect, we have reflect-
ed the connection of our activities to
our stakeholders, as well as to Sus-
tainable Development Goals, with
icons in our value creation process.
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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64
Value creating Turkcell
Turkcell value creation process
I n p u t s
Business operations
O u t p u t s
Va l u e c re a te d
S D G
Related stakeholders
Financial capital
• Revenues from operations
• Business model hedging
• Efficient capital allocation
• Financing diversity
• Strong and transparent financial
management
Human capital
• Diversity, inclusiveness, and equal opportunity
• Our competent employees and career
development
• Safe and healthy workplace environment
• Agile teams/employees
• Employment practices that make a difference
Intellectual capital
• Patents and R&D studies
• Entrepreneurship ecosystem, start-up and
university collaborations
• Services and applications
• Artificial intelligence and blockchain applications
• Being a strong brand
• Cyber security services
• Company policies
Manufactured capital
• Strong network
• Strong spectrum
• Strong fiber infrastructure
• Data centers
Social values and relationships
• Strong communication with our employees and
their families, our customers, our suppliers, and our
common values
• Civil society, academy, public and corporate
partnerships, international representation of the
sector and our country
• Social investment projects and sponsorships
• Transparent and trust-oriented stakeholder relations
Natural capital
• Natural resources management
• Renewable energy investments and projects
M a i n co m p ete n c i es
Strong bond
with customers
Strong
infrastructure
Advanced
analytical
capabilities
& technology
Strong & agile
team
TURKCELL INTEGRATED ANNUAL REPORT 2020
Outputs
TRY29.1
billion revenue
TRY12.3
billion EBITDA
TRY6.3
billion EBIT
TRY4.2
billion net income
TRY3.4
billion free
cash flow
1,080
R&D employees
557
patent applications
10
incubator
collaborations
4.5G speed
up to
1.4 Gbps
76%
increase in
network traffic
rate
51%
network
virtualization
rate
Big Turkcell Group
family of
24,675
people
Fiber internet
speed up to
10 Gbps
33.4
million mobile
subscribers (Turkey)
47.9
million Group
subscribers
Investment to
social investment
projects with
1% of our
annual revenue
36.1%
localization rate
in our suppliers that
make up 90% of
our purchasing
volume
1.4 million
total training
hours
19,409.38
t CO2e Scope 1
emissions
440,938.58
t CO2e Scope 2
emissions
63,699.52
t CO2e Scope 3
emissions
1.6 million
kWh installed total
renewable energy power
6.5 tons
of electronic waste
recovered with Recycle
into Education
• Value created through sustainable growth
• Strong balance sheet
• Market capitalization
• Dividend paid and dividend yield
• Value created for countries of operation
• Contribution to employment
• Having competent human capital - ready for the future digital world
• Creating a strong and agile working culture
• Developing competencies to increase female employment in the technology sector
• Being a good employer
• Enhancing innovation and the entrepreneurial ecosystem with Turkcell experience
• Becoming an operator on a global level with digital operator vision
• Facilitating life by developing inclusive and value-added products and services
• Better understanding the customer through data analysis skills
• Reducing cyber security-related risk and meeting the cyber security needs of customers
• Ensuring ethical and equal business processes
• Value creation through use of open-source coding
• Offering fast, quality, and inclusive services
• Contribution to keeping Turkey’s data in Turkey
• Leadership in technology and digital transformation
• Inclusive access to information and the internet
• Improving domestic and national technological infrastructure
• Strong corporate management
• Value created through social investment projects
• Contribution to sharing information and experience among stakeholders
• Net Promoter Score
• Adapting a responsible and ethical business mindset to the Turkcell ecosystem
• Contribution to the socio-economic and cultural development of society
through supporting NGOs
• Net customer additions
• Being both leading and pioneering company in the sector and country
through representations
• Ratio of energy consumption from renewables
• Annual energy savings
• Responsible use of resources
• Improving carbon emissions performance
• Reducing customers’ environmental impact
• Financial value created through sustainability activities
• Consumption of energy and resources due to Turkcell’s growing operations
Shareholders, Employees, Suppliers,
International organizations
Shareholders, Employees, Suppliers, Public
institutions, Civil society organizations,
Autonomous organizations, International
organizations
Employees, Consumer segment
customers, Corporate segment customers,
Suppliers, Public institutions, Civil society
organizations, Autonomous organizations,
International organizations, Media,
Corporate social responsibility projects
beneficiaries
Employees, Consumer segment
customers, Corporate segment customers,
Suppliers, Public institutions, Autonomous
organizations, International organizations
Shareholders, Employees, Consumer
segment customers, Corporate segment
customers, Suppliers, Public institutions,
Civil society organizations, Autonomous
organizations, International organizations,
Media, Corporate social responsibility
projects beneficiaries
Shareholders, Suppliers, Public institutions,
Civil society organizations, International
organizations, Corporate social
responsibility projects beneficiaries
65
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TURKCELL INTEGRATED ANNUAL REPORT 2020
66
Strategic focus areas
and business operations
Our telecom business
In order to pursue
sustainable and
profitable growth,
we focus on three
strategic areas, namely
digital services, digital
business services
and techfin services
along with our main
line of business,
telecommunication
services.
We shape our business operations
that support our value creation pro-
cess in accordance with our strategic
initiatives. We digitize the lives of our
stakeholders by leveraging our core
competencies. In order to pursue sus-
tainable and profitable growth, we
focus on three strategic areas, namely
digital services, digital business ser-
vices and techfin services along with
our main line of business, telecom-
munication services. We continue to
improve our digital services and ex-
pand them internationally. Through
our digital business services, we pro-
vide end-to-end solutions to private
sector companies and public insti-
tutions, meeting all their technologi-
cal needs and assisting in their dig-
ital transformation. We address the
needs of these companies and insti-
tutions through services ranging from
cyber security to cloud solutions, and
from IoT to establishing integrated IT
system infrastructure. As part of our
techfin services platform, another of
our Company’s strategic focus area,
we continue to expand individual and
corporate customer base of Paycell,
our payment system, through new in-
tegrations.
You can find details on our measur-
able targets for achieving success
within the scope of our business op-
erations conducted in line with our
strategic initiatives in the relevant sec-
tions of this report. Turkcell defines the
period of short-, mid- and long-term
targets as:
Ta rg et s *
We sustain our
customer net addition
performance thanks
to our strategy of
always standing by
our customers, while
delivering innovative
and extensive offers
and additional
benefits. We met the
fixed internet demand
of our customers
through new offers and
options.
Short-term
target
0-1 year
Medium-term
target
1-3 years
Long-term
target
3+ years
While
technological developments
have been affecting every sector in
various scales, the telecommunica-
tions sector is one of the most im-
pacted. The companies operating
in telecom sector value the diversity
of alternative products and services
achieved through digital transforma-
tion as they continue to invest in the
core business line, telecom services,
and sustain profitability. In this re-
spect, the strong customer demand
for the distinctive mobile and fixed
offers that we provide as part of
our telecom services continues. We
achieve robust growth in our mobile
business on the back of increasing
data usage, our upsell efforts and in-
creasing share of postpaid subscrib-
ers. We also achieve strong growth
on the fixed front with the rising
number of fiber and IPTV customers.
We continued to provide innovative
mobile and fixed offers to our custom-
ers in 2020 as part of our telecommu-
nication solutions that connect mil-
lions to each other. Responding swift-
ly to changing customer needs and
executing the required solutions have
remained our priority in the pandemic
environment. Plans for Teams, the in-
centives of which can be shared with
family members or friends, and Mega
Plans, which allow annual data quo-
ta purchase, ranked among our new-
ly-introduced services. We sustain our
customer net addition performance
thanks to our strategy of always
standing by our customers, while de-
livering innovative and extensive offers
and additional benefits. We met the
fixed internet demand of our custom-
ers through new offers and options.
And by extending smart offers and
win-win propositions, we empowered
the usage habits of our customers,
who have opted for greater use of our
digital channels during the pandemic.
The strong demand for mobile data
usage continued in 2020 with the
growing number and higher data
consumption of 4.5G subscribers.
While the average data usage of
our subscribers rose 44% year-on-
year and reached 13 GB in Q420, the
data consumption of 4.5G subscribers
reached 14.9 GB on 38% year-on-year
rise in the last quarter of the year.
We registered strong
mobile ARPU (except
M2M) growth of
15.0% in 2020 thanks
to rising data usage,
upsell efforts and
the growing share of
postpaid customers.
We registered 9.2%
residential fiber ARPU
growth on the back of
renewed value offers,
upsell efforts, higher
speed plans and the
rising share of IPTV
users.
You can find the opportunities
identified in line with our
strategic focus areas and core
competencies in the strong
corporate governance section.
* Please note that this report contains forward looking statements based on our current estimates and expectations regarding market conditions for each of our different bu-
sinesses. No assurance can be given that actual results will be consistent with such estimates and expectations. For a discussion of factors that may affect our results, see our
Annual Report on Form 20-F for 2019 filed with the U.S. Securities and Exchange Commission, and in particular, the risk factor section therein.
67
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Value creating TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
69
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Value creating Turkcell
Digital services
Digital business services
As the world’s first
digital operator, we
support private sector
companies and public
institutions during their
digital transformation
journey leveraging
our digital business
services, which we
developed to offer our
25 years of technology
experience to our
corporate customers.
We continue to
work 24/7 to create
worldwide success
stories with OTT
(over-the-top media
services) brands that
will open up to the
world as brand-new
companies and prove
more attractive to
foreign investors.
Our digital services and solutions,
which have millions of users world-
wide, are centered on life and expe-
rience. We continue to provide solu-
tions that meet our users’ every digital
need through our value-added digital
services and solutions, from music to
TV, personal cloud to instant commu-
nication, search engine to e-mail and
sports to games. While these services
positively reflect on the ARPU levels
of our users, they also increase their
loyalty to Turkcell. And while we pi-
oneer Turkey’s digital transformation
thanks to our locally developed digital
services, we also extend our expertise
in this field beyond the borders of our
country through our subsidiaries and
business partners.
In order to stand out among the com-
petition on a global level, we estab-
lished four separate companies for
BiP, fizy, TV+ and lifebox services and
they began their new journey on July
1, 2020. Going forward, these ser-
vices will continue to progress fast-
er, stronger and with greater focus
through
their own organizational
structures. We continue to work 24/7
to create worldwide success stories
with OTT (over-the-top media ser-
vices) brands that will open up to the
world as brand-new companies and
prove more attractive to foreign in-
vestors. Our new companies continue
their growth trajectories to offer digi-
tal experiences not only to their users
in Turkey, but also to their users across
the world.
While our applications, which do not
have content dependency, have users
in 192 countries around the world, our
content based applications are man-
aged with plans to rapidly increase
their penetration. We are swiftly pro-
gressing in terms of digital transfor-
mation with BiP, fizy, TV+ and lifebox
services, developing dozens of fea-
tures that are firsts in the world. More-
over, we continue to store the applica-
tion data at our own data centers as
part of our data localization strategy.
BiP Meet, the video-conference solu-
tion introduced to Turkcell employees
for test use as of June 2020, was in-
troduced to the end-users in October
2020. Thus, we rapidly implemented a
solution that met the rising need for
remote meeting and business man-
agement during the pandemic.
Payment and access methods such
as mobile payment, credit card, ap-
plication store payment infrastructures
and gift cards at technology stores
increase channel diversity for sales of
digital services. We are able to offer
an operator independent digital au-
thentication service based on different
security and verification levels through
Fast Login, another Turkcell solution.
their digital
As part of our digital business ser-
vices strategic focus area, we offer
end-to-end value added services,
that reflect customer needs, to private
sector companies and public institu-
tions alike, leveraging new technol-
ogies including cloud, cyber security,
Internet of Things, big data, business
solutions, managed services and ar-
tificial intelligence that are becoming
increasingly important in today’s busi-
ness world in parallel to technological
developments. As the world’s first dig-
ital operator, we support private sec-
tor companies and public institutions
during
transformation
journey leveraging our digital business
services, which we developed to offer
our 25 years of technology experience
to our corporate customers. The solu-
tions we offer ensure that our custom-
ers stay at the very forefront of what
the market has to offer. We constantly
expand our services portfolio, which
is well-positioned to serve customers
of all scales, and create new solu-
tions and offerings particularly target-
ing small-scale customers. Offering
end-to-end
information technology
services, we provide our customers
“digital transformation consultancy” at
various scales and in different sectors
along their digital transformation jour-
ney. Leveraging our extensive sales
network, strong partner ecosystem
and superior infrastructure, we aim to
be Turkey’s number-one information
technology and digital solutions pro-
vider.
Creating value-added solutions that
distinguish us from the competition
within the scope of our digital busi-
ness services, we serve corporates
with a brand-new business model
that addresses their end-to-end tech-
nology needs. Meanwhile, in lever-
aging our qualified human capital in
accordance with this business model,
we meet customer needs with tai-
lor-made solutions. In evaluating our
2020 business results, we observe the
positive reflections of the changes we
made, despite the pandemic environ-
ment that deeply impacted the global
economy. During Turkey’s digitalization
journey, we will continue to provide
end-to-end solutions to organizations
and our business partners as part of
our digital business services focus.
In addition to our strong mobile net-
work and approximately 50 thousand
km end-to-end fiber
infrastructure
that enables us to deliver superior
quality services, we have 8 new gen-
eration data centers, 3 of which have
Tier-3 Design and Operational Sus-
tainability certificates received from
the Uptime Institute, an international
certification institution.
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TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
70
Value creating Turkcell
As part of the digital
transformation
journey of
organizations,
we meet all their
needs end-to-end,
ranging from team
and document
management to
digitalization of
financial processes
and staff trainings,
through Turkcell digital
business services.
We store the entire information tech-
nologies infrastructure of organiza-
tions at Turkcell data centers through
Turkcell Cloud services; we thereby
ensure a more flexible infrastructure
while reducing their costs. The cloud
service, which we provide with a full
back-up infrastructure at six data
centers, has ISO 27017 Cloud Informa-
tion Safety Certification, confirming
our information security competence.
We are the first and only service pro-
vider in Turkey to hold this certificate.
In the cyber security field, another
component of digital transformation,
we protect corporates against cyber
threats through our FIRST and OIC-
CERT member Security Operation
Center, consultancy services such as
penetration tests and vulnerability
analyses, and a large cyber security
product portfolio. With the Turkcell IoT
platform, that we established as part
of our strategy to provide end-to-end
solutions to institutions and our busi-
ness partners, we allow companies to
manage their equipment and machin-
ery remotely via the cloud without
any need for infrastructure investment,
and to develop their solutions on the
Techfin services
And with the world
having undergone
a rapid techfin
transformation over
the past decade, the
penetration of techfin
services and solutions
has risen swiftly. As
Turkcell, we have
been pursuing our
activities aware of this
potential in the techfin
field, catering to our
customers with our
services and solutions
under the Paycell and
Financell brands.
market in Turkey, where competition is
focused on providing solutions in par-
ticular verticals, Paycell is differentiat-
ed by its strong positioning enabled
by its wide portfolio of services, and
its access to Turkcell’s deep technol-
ogy expertise, large customer base
and sales channel. As part of its go
to market strategy, Paycell focuses on
increasing the number of merchants
through mobile POS and QR payment
solutions, while making efforts to
raise the number of Super App users.
Financell, the leader of the non-bank
financial sector by customer num-
ber, aims to contribute to the digital
transformation of Turkey by becoming
the financing partner of Digital Busi-
ness Services in accordance with our
Group’s growth strategy in the cor-
porate segment. Under the Financell
roof, we offer financing solutions to
our consumer and corporate segment
customers for their purchases of tech-
nological products and services. We
effectively manage credit risk by con-
ducting a faster credit assessment,
leveraging our credit risk infrastructure
and digital transformation capabil-
ities. Meanwhile, we aim to become
the largest Insurtech player in Turkey
with the end-to-end digital solutions
of Turkcell Sigorta. We offer innova-
tive solutions for customers’ risk man-
agement with fast and easy access
products. In this respect, customers
have the opportunity to conveniently
access and purchase insurance prod-
ucts via all Turkcell channels including
call center, digital channels and stores.
In the new digital era, where the
majority of interactions have moved
to digital platforms, many financial
transactions in daily life are also in-
creasingly digitized. And with the
world having undergone a rapid tech-
fin transformation over the past dec-
ade, the penetration of techfin servic-
es and solutions has risen swiftly. As
Turkcell, we have been pursuing our
activities aware of this potential in the
techfin field, catering to our custom-
ers with our services and solutions un-
der the Paycell and Financell brands.
With Paycell, our vision is to integrate
technology and financial services in
accordance with changing customer
needs and habits, and to enable more
customers to readily access financial
services by offering fast and secure
payment solutions. Factors including
Turkey’s large and young population,
high smart device penetration, near-
ly 30 million unbanked potential us-
ers, high prevalence of cash usage in
shopping, rising e-commerce volumes
and supportive regulatory develop-
ments, create a favorable environ-
ment for increasing the penetration
of digital payment services in Turkey
and support the usage of solutions
offered by Paycell. Furthermore, the
COVID-19 pandemic, which has im-
pacted the world since the beginning
of 2020, changed the payment hab-
its of people and increased the de-
mand for digital payment services. As
Paycell, we meet the digital payment
needs of our customers through our
wide payment solutions portfolio, and
thereby facilitate their lives. Accord-
ingly, we introduce our services and
solutions to our customers in various
verticals including direct carrier billing,
bill payment, e-wallet, money trans-
fer and payment facilitation over our
application, which we position as a
Super App. In the fragmented techfin
IoT platform. Analyzing dynamic and
real data through our big data servic-
es, we support our customers’ stra-
tegic decision-making process, thus
contributing to their profitability and
efficiency. As part of the digital trans-
formation journey of organizations,
we meet all their needs end-to-end,
ranging from team and document
management to digitalization of fi-
nancial processes and staff trainings,
through Turkcell digital business ser-
vices.
In addition to all our products and
services, so far, we have implement-
ed approximately 1,500 tailor-made
projects for our customers in man-
aged services and system integration
fields, leveraging the power of our
business partners identified as experts
in their fields, as well as our internal
resources, products and processes.
We implement digital transformation
projects with our consultants, who are
experts in their fields, designing verti-
cal solutions that address the needs
of each sector. In the health sector, as
an integrator providing and manag-
ing all required technology solutions
for city hospitals, we hold the leading
position in the public-private sector
partnership (PPP) market by bed ca-
pacity and hospital number. We have
active operations at seven city hospi-
tals, namely Yozgat, Adana, Eskşehir,
Elazığ, Bursa, Başakşehir and Tekirdağ
City Hospitals, and two field hospi-
tals managing the entire technology
infrastructure from hardware to soft-
ware and from systems to operations.
Meanwhile, we continue to grow our
ecosystem, cooperating with sub-
contractors and business partners
in product / business development
and sales with a win-win approach.
Moreover, we regularly expand the
solutions portfolio that we offer to
our customers in terms of technical
capability and project diversity by
establishing partnerships with global
vendors.
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
71
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72
Interactions with our stakeholders
Material topics
In light of feedback
and suggestions
received from our
stakeholders, we
continuously improve
our processes and
work to enhance our
performance.
At Turkcell, we work to provide the
maximum benefit to our stakeholders
and create value. We value the views
of our stakeholders and consider all
groups impacted by our activities with
an inclusive approach to the greatest
extent possible. In light of the feed-
back and suggestions received from
our stakeholders, we continuously
improve our processes and work to
enhance our performance. Fueled by
these firm ambitions, we will continue
to create value for all our stakeholders
in the upcoming periods.
SDG 17.17
The fundamental working principles
we adopt as Turkcell include inclu-
siveness, accessibility, and the pro-
vision of transparent, consistent, and
timely information to the stakehold-
ers. We believe in simultaneous and
open dialogue with our stakeholders,
and work continuously to address all
questions and requests from them
swiftly and accurately. In this respect,
we have mapped Turkcell’s materi-
al topics in our materiality matrix by
taking on board our stakeholders’ val-
uable views.
You can find the details of
our communication channels
with various stakeholders in
Appendix-1: Communication
channels table.
In order to identify the
material topics that
guide our management
approach and 2020
integrated annual
report structure, we
analyzed global
and sectoral trends
together with our key
internal and external
stakeholders’ views,
global stakeholders’
reports, and the
principles set out
by international
organizations such as
GSMA, GRI and SASB.
We identified the topics of the ques-
tionnaire, which we addressed to
our key stakeholders based on glob-
al trends and by incorporating the
outputs of workshops with working
groups, which include representatives
from our key departments. We took
priorities of our stakeholders into
consideration while we conducted
a comprehensive stakeholder anal-
ysis by reaching out to our internal
and external key stakeholder groups
through the questionnaire to receive
their opinions. We evaluated and in-
terpreted the 2020 Turkcell materi-
al topics, which we classified under
environmental, social, governance,
products, and infrastructure topics,
from the perspective of our strategic
focus areas and core competencies,
as well as the results of stakeholder
analysis. Following this stage, we in-
tegrated these topics with Turkcell’s
sustainability material topics identi-
fied in previous reporting periods. As
part of the external trend analysis, we
analyzed SDGs, the World Economic
Forum Global Risks Report 2020*, and
the initiatives that guide the busi-
ness world and mobile communica-
tion sector. We also took the reports
published by companies operating in
the same sector into consideration
in order to assess their perspective
on society and the sector. Having
integrated the views of our senior
management, we established Turk-
cell’s material topics from an inte-
grated value creation perspective.
The process of material topic identification
n
d a
g i c f
a l y s i s
c u s a r e as and core c
o
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bilit
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ble Devel o p m e
* World Economic Forum – Global Risk Report 2020,
http://www3.weforum.org/docs/WEF_Global_Risk_Report_2020.pdf
Value creating TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
74
High
s
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Cyber security
and privacy
Superior digital services
and innovation
Customer satisfaction
and loyalty
Strong infrastructure and
superior service quality
Being a good
corporate citizen
Fight against climate change
and effective energy management
Creating social
value
Strong financial
performance
Value oriented
responsible supply chain
Effective risk
and crisis
management
Low
Importance for Turkcell
High
Environmental
Social
Governance
Products and infrastructure
Interaction of material topics
s
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Sustainable
Development
Goals
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o
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p
Stakeholder
group
Material
topics
Superior digital
services and innovation
Customer satisfaction
and loyalty
Cyber security
and privacy
Strong infrastructure and
superior service quality
Being a good
corporate citizen
Creating
social value
Fight against climate
change and effective
energy management
Strong financial
performance
Value oriented,
responsible supply chain
Effective risk and
crisis nanagement
75
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Value creating TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
76
Measuring the value created
As Turkcell, we are
sensitive to the value
we create for society,
the environment,
and the economy
in developing our
products and services
and conducting our
activities. In addition to
its positive reflection
on our financial
performance, we
have the opportunity
to observe the value
we create through
our relationship with
key stakeholders such
as our suppliers and
customers, and through
our social investment
activities.
We aim to obtain more up-to-date
and comparable results by incorpo-
rating the views of our key stakehold-
ers, global and sectoral trends, the
reports of global stakeholders, and
the recommendations of internation-
al organizations such as GSMA, GRI
and SASB in identifying the material
topics that guide our operations and
sustainability activities.
SDG 17.16
joined the UNGC. In addition, we
became a signatory to the UNGC
“Statement for the Private Sector” in
2020. We integrate the 10 principles
that UNGC identified under the topics
of human rights, working standards,
environment and combating corrup-
tion into our business processes. We
publish our state of adherence to the
10 principles in our UNGC Communi-
cation on Progress Report (CoP) an-
nually.
You can access the SDG
mapping of our material topics
in the Interaction with our
Stakeholders section of this
report.
Sustainable Development Goals
Sustainable
Development Goals
(SDGs) were adopted by the Unit-
ed Nations in 2015. They comprise
17 goals and 169 targets that aim to
end poverty, protect our planet, and
enable people to live in peace and
welfare by 2030. SDGs help corpo-
rates to calibrate their objectives in
line with the 2030 agenda. Turkcell
also takes SDGs and their priorities
into account while conducting its
operations. Moreover, we also take
SDGs as a guideline in identifying our
material topics, which we renew an-
nually by considering the priorities of
our stakeholders and of Turkcell.
In the integrated annual report, our
activities that contribute to SDGs are
demonstrated with the relevant SDG
icons within the text. Our activities
that we have matched with SDGs
contribute to either one or more tar-
gets.
United Nations Global Compact
In 2000, the United Nations Global
Compact was established to dissem-
inate sustainable and responsible
policies, practices, and reporting in
the business world. We are among
the first Turkish companies to have
You can access our statements
regarding our progress on UNGC
Principles in the UNGC progress
table section.
Furthermore in 2020, within the scope
of the 75th anniversary of the United
Nations, we supported the global co-
operation initiative, which stresses
the point that ours is a time of “un-
precedented deterioration and glob-
al transformation” urging both the
public and private sector to act re-
sponsibly in the face of crises such as
climate change, economic uncertain-
ty, social injustice, increasing disinfor-
mation and, in particular, COVID-19,
and advocating immediate initiation
of international cooperation in these
fields.
United Nations Women
Empowerment Principles (UN WEPs)
We have been a signatory to the
United Nations Women’s Empow-
erment Principles since 2012 in sup-
port of equal opportunities. Guiding
the activities and policies of institu-
tions around seven principles in line
with the 2030 goals of the SDGs, UN
WEPs supports practices that aim
to empower women in the business
environment, such as equal wage
practices and zero tolerance against
discrimination.
77
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Value creating TurkcellTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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About Turkcell
Strong
corporate
governance
84
86
Management Team support for value-creation process
Trends and their impacts
98
Effective risk and crisis management
102
Strategic initiatives and opportunities
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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80
Strong corporate governance
Demonstrating
exemplary corporate
citizenship
Having a strong
corporate management
system enables us to
operate at the highest
efficiency level and to
demonstrate exemplary
corporate citizenship
through compliance
with all regulatory
responsibilities.
Moreover, we
differentiate as a
company, trusted
by our stakeholders,
thanks to compliance
with domestic and
international business
regulations ensured
by our Company’s
compliance programs
and our understanding
of superior business
ethics.
SDG 16.6
You can access our detailed
explanations as to corporate
governance in the Corporate
Governance Principles
Compliance Report section of
this integrated report, which
was previously presented within
our annual reports.
Turkcell is the only Turkish company
listed on both Borsa Istanbul (BIST) and
the New York Stock Exchange (NYSE).
This status in the capital markets en-
ables us to adopt corporate govern-
ance principles in a permanent and
optimal way within the internal or-
ganizational structure, which confirms
our commitment in the long-term and
sustainable value that our effective
corporate processes create. Turkcell
acts in accordance with sectoral reg-
ulations and competitive dynamics,
and closely follows current develop-
ments. It reports cases that may occur
within this scope with transparency,
while categorizing the current litiga-
tion management system according
to ESG factors is among the goals of
future periods.
Turkey’s Turkcell has
become stronger
Upon completion of the share
transfer transactions immediately
after the Ordinary General As-
sembly meeting held on October
21, Turkey Wealth Fund has be-
come the largest shareholder of
our Company with a 26.2% stake,
including a 15% privileged stake in
parallel to its mission of investing
in the strategic value of Turkey.
shareholder
Within
the scope of Turkey
Wealth Fund’s strategy of sup-
porting Turkey’s strategic compa-
nies, their presence as Turkcell’s
largest
represents
trust in Turkcell and its potential
by emphasizing the importance
of technology & digitalization.
This change, leading to a sim-
plified shareholding structure of
Turkcell, intends to prevent poten-
tial conflicts of interest between
shareholders in the new era, and
to create long-term value for all
shareholders.
Shareholder structure
Since 2000, Turkcell İletişim Hizmetleri
A.Ş has been the only company, shares
of which are traded on Borsa Istanbul
and also on the New York Stock Exc-
hange as “ADS (American Depository
Share)” Level III.
You can access further details
on our shareholder structure in
Note 1 of the IFRS report.
As a listed Company, we aim to pro-
vide long-term benefits not only to
our customers, but also to all our
stakeholders with operating at the
highest standards of corporate gov-
ernance practices. In this context, we
demonstrate exemplary corporate
citizenship by improving our sustain-
ability strategy and value creation
model, and also by making it one of
our primary goals to act in line with
international standards in the fields
of human rights, business ethics, an-
ti-bribery and corruption, competition
management, risk and crisis manage-
ment.
Compliance with international capital
markets and effective corporate
governance practices
In line with our aim of being an exem-
plary corporate citizen, we oversee
compliance with national and inter-
national Anti-Bribery and Corruption
(ABC) standards covering all our ac-
tivities, and attach importance to
being a trusted company for all our
stakeholders. The Anti-Bribery and
Corruption Policy, adopted by the
Board of Directors in 2016, is among
our fundamental documents embod-
ying our combat against bribery and
corruption while reflecting the “zero
tolerance” principle of the Board of
Directors on the subject. Our ABC Pol-
Within the framework
drawn up by the
ABC Policy, the ABC
Program has been
carried out with the
establishment of the
Corporate Governance
& ABC Program Office
(ABC Office), which
takes the necessary
preventive measures
to ensure compliance
with these rules and
provides risk-based
trainings and internal
communications, as of
April 2018. 594 Turkcell
employees received
87 hours of ABC Policy
training in 2020.
icy is publicly available, and we ex-
pect the entire Turkcell ecosystem to
act in line with this document. Within
the framework drawn up by the ABC
Policy, the ABC Program has been
carried out with the establishment
of the Corporate Governance & ABC
Program Office (ABC Office), which
takes the necessary preventive meas-
ures to ensure compliance with these
rules and provides risk-based train-
ings and internal communications, as
of April 2018. 594 Turkcell employees
received 87 hours of ABC Policy train-
ing in 2020.
SDG 16.5
Turkcell due to its specifical position in
the capital markets is putting a dual
rule set into practice, within the frame-
work of both Turkish and U.S. capital
markets, particularly on corporate
governance structures and financial
reporting processes. Among Turkcell’s
effective corporate processes
im-
plemented as part of those require-
ments, the following can be named:
Turkcell Board of Directors and its
committees’ structure, operating rules
and independence of its members;
the effective internal control environ-
ment regarding the financial report-
ing processes based on reporting and
disclosure liabilities before the Capital
Markets Board (CMB), U.S. Securities
and Exchange Commission (SEC), BIST
and NYSE; the ethical rules applicable
to the company’s senior management
as well as finance executives in ac-
cordance with SEC; the code of con-
duct for members of the Board of Di-
rectors who are also public officials;
and the blackout period and the quiet
period for the trading of shares.
Practices based on the Public Com-
panies Accounting Reform and In-
vestor Protection Act, also known as
Sarbanes-Oxley (SOX) Act and U.S.
Foreign Corrupt Practices Act (FCPA),
which aim to improve the control
mechanisms of companies’ financial
reporting while supporting effective
corporate management, particularly
stand out as part of Turkcell’s long-
term and sustainable corporate DNA.
As of January 2020, Turkcell’s Sanc-
tions Compliance Program adopted
by the Board of Directors has been put
into effect. Within the scope of Turk-
cell’s Sanctions Compliance Program,
as an example of good practice, the
existing processes of our Company
have been reviewed and transformed
into a written procedure in line with
international developments regarding
economic and trade sanctions – with
a particular focus on OFAC (Office of
Foreign Assets Control).
Due to our dual listing in the cap-
ital markets, in order to carry out
our obligations to comply with cap-
ital markets regulations and corpo-
rate governance practices that we
are subject to under an autonomous
structure that has direct access to
the Board of Directors, SOX Coordi-
nation and Compliance Unit has been
established within the ABC Office
as of January 2019. The SOX Coor-
dination and Compliance Unit, along
with monitoring the regulations of
SEC and Public Company Accounting
Oversight Board, supports corporate
transparency and contributes to relia-
ble information disclosure to the pub-
lic by incorporating good practices
within our Company. Accordingly, dur-
ing the COVID-19 and remote work-
ing period, necessary actions are be-
ing taken against possible risks and
good practices are continued to be
adopted in accordance with the U.S.
legislations which our Company and
our independent auditor complies to
by following developments regard-
ing our Sarbanes Oxley 404 internal
control environment and regulatory
authorities’ guidelines. Training and
awareness activities are carried out
by the SOX Coordination and Compli-
ance Unit under the title of SOX 404
practices that constitute an integral
part of our employees’ way of doing
business. As part of SOX 404 related
activities, 12 internal company bulle-
tins were published and a total of 48
hours of training was provided to 44
employees in 2020.
Human rights, work ethics and
common values
The big Turkcell family and the Turkcell
ecosystem are aware of the impor-
tance of having a responsible busi-
ness model that complies with ethi-
cal standards, and that its employees
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Strong corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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With the Turkcell
Common Values and
Code of Business
Ethics (TODİEK)
handbook, which was
developed in line with
global best practices
and adopted by the
Board of Directors, we
protect our employees,
being our family,
and demonstrate
exemplary ethical
behavior across our
ecosystem.
• Various initiatives are taken to en-
sure employee happiness and welfare
such as increasing business efficiency,
digitizing business processes, facil-
itating workplace life and access to
business tools, finding quick solutions
to technical and administrative prob-
lems, providing side benefits to em-
ployees, objectively measuring per-
formance. Necessary actions are tak-
en to ensure the accessibility of our
platforms to our disabled employees.
• Our suppliers and business partners
are encouraged to adopt and imple-
ment these principles, which we have
adopted for our employees.
SDG 8.5
As declared in our Human Rights Pol-
icy, we respect our employees “Right
and Freedom to Assemble” and “Right
and Freedom to Establish and Engage
in Union Activities” according to the
Constitution of the Republic of Tur-
key. We also support our employees
in becoming members of professional
groups in their field, or of NGOs that
provide social benefit.
With the Turkcell Common Values
and Code of Business Ethics (TODİEK)
handbook, which was developed in
line with global best practices and
adopted by the Board of Directors,
we protect our employees, being our
family, and demonstrate exemplary
ethical behavior across our ecosys-
tem.
You can access our Human
Rights Policy on our website.
form the basis of its success. Accord-
ingly, it implements the Human Rights
Policy to create a work environment
worthy of human dignity and value.
Turkcell pays attention to the ethical
and responsible development and use
of the technologies that it uses and
will develop in business processes. It
aims to create a more livable world
by contributing to UN Sustainable De-
velopment Goals, respecting human
dignity, fundamental rights and free-
doms in the technologies it develops,
especially artificial intelligence tech-
nology. Under this Policy;
• Employees are not assessed based
on their gender, religion, language,
race, ethnic origin, physical appear-
ance, and disability when making
decisions with respect to recruitment,
promotion, development etc.
• All kinds of discrimination and har-
assment against or between employ-
ees are opposed and no compromise
is ever made on these issues.
• The “Right and Freedom to Assem-
ble” and the “Right to Establish and
Engage in Union Activities” of our em-
ployees, as also expressed in the Con-
stitution of the Republic of Turkey, are
respected.
• Modern working environments are
provided, especially to ensure occu-
pational health and safety.
• Legal working hours are respected,
and the work-life balance is main-
tained and encouraged.
• Measures are taken against all
kinds of violence in the workplace or
at home, and our policies and pro-
cedures, which form the basis of our
corporate management, include ad-
equate and clear regulations on this
issue.
In 2020, 24 cases
have been examined.
However, none of
those 24 cases is
related to any incidents
violating the Turkcell
Group Anti-Bribery and
Corruption Policy.
Our employees, customers and suppliers can convey reasonable doubts
and information regarding cases that violate, or may present a potential
violation of business ethics to the Turkcell Ethics Committee anonymously
through the Ethics Line (532 210 4444). Additionally, our employees can
report cases of violations of regulations or ethically inappropriate situations
directly to the Audit Committee auditcommittee@turkcell.com.tr or
indirectly via our Ethics Committee. They can use the Company’s intranet,
internal forms, telephone and e-mail etikbildirim@turkcell.com.tr.
In 2019, 42 cases were
reported
through Ethics Channels and were
reviewed. These cases were handled
under the 3 main categories of unethi-
cal and immoral behavior, information
security incidents and financial-relat-
ed issues. Among measures taken as
a result of the examined cases, there
were 6 terminations of employment.
Out of 42 cases, 1 was evaluated as
non-material fraud and a lawsuit was
initiated by the Company. In 2020, 24
cases have been examined. Howev-
er, none of those 24 cases is related
to any incidents violating the Turkcell
Group Anti-Bribery and Corruption
Policy.
Competition management
Turkcell and Turkcell Group companies
take various measures to ensure and
protect effective competition in the
markets where they operate, as well as
to carry out business and transactions
in accordance with the relevant com-
petition law and regulations. The main
objective of competition law is to pre-
vent dominant players in the market
to abuse their power by establishing
inter-company agreements, decisions
and practices, which avoids, distorts
or restricts fair competition. Moreover,
the competition law controls merger
and acquisition transactions to pre-
serve competition in the markets, and
makes necessary regulations and con-
ducts supervision to protect competi-
tion. In this context, certain processes
are followed within Turkcell, including,
but not limited to the following:
• The guidelines, briefings and train-
ings prepared as part of the competi-
tion compliance process are examined
by all employees.
• In line with our general principles,
any verbal or written agreements and
communications with competitors on
the following issues are avoided; price
determination, sharing of customer/
region, sharing of trade channels, re-
striction of supply amount or initiating
a boycott, and collusion in tenders.
• Sharing sensitive information among
competitors is prohibited.
• Causing difficulties for the activities
of competing companies, prevention
of new entrance to the market, high
sales prices and sales prices below
cost are avoided.
• Resale prices of third parties that re-
sell Turkcell products and services are
not interfered in by Turkcell. Recom-
mended sales price notification rules
are precisely followed.
Turkcell and Turkcell Group companies
act in all their markets of operation
in accordance with competition rules
under the Turkish Commercial Code,
the Law on the Protection of Compe-
tition, the Electronic Communications
Law and secondary legislations.
We disclose information on critical
cases that Turkcell is a party to, as
part of our disclosures to the BIST, SEC
and other related authorities in com-
pliance with CMB and IFRS standards.
In this context, critical cases arising
from competition law are also includ-
ed in those reports. In 2020, there is no
preliminary research initiated, or in-
vestigation filed against our Company
before the Competition Authority for
alleged violation of competition reg-
ulations under the Law on the Protec-
tion of Competition.
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Strong corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
84
Management Team support
for value-creation process
Chaired by the
Chairman of Turkcell
Board of Directors,
the Turkcell Integrated
Value Creation
Committee was
established at Senior
Management level
to regularly report
its activities to the
Board of Directors and
inform relevant Board
Committees when
necessary.
Turkcell’s management model adopts
the mission of creating short, medium
and long-term value with the sup-
port of its management team. Turkcell
Board of Directors steers the strategic
initiatives of Turkcell in accordance
with the principles of accountability
and fulfilling responsibility. In accord-
ance with Capital Markets Legisla-
tion, the senior management of our
Company is defined, as “Persons with
Administrative Responsibility” and the
members of the board of directors,
and such persons who, although not
a board member, have the authority
to regularly access the insider infor-
mation of the Company directly or
indirectly and make administrative
decisions affecting the future develop-
ment and commercial targets of the
Company. Persons with administrative
responsibility in our Company are de-
termined as the Board Members and
Company Management Team.
The business relations of Turkcell are
governed through the resolutions of
the Board of Directors, who represents
the Company’s shareholders and is re-
sponsible to them. The Board of Direc-
tors consists of 9 members, who have
general management
responsibility
regarding Turkcell’s activities accord-
ing to Turkcell’s Articles of Association.
As of December 31, 2020 the Board
consisted of 5 members. In accord-
ance with the Articles of Association,
5 out of 9 members are elected by
TVF Bilgi Teknolojileri İletişim Hizmetleri
Yatırım Sanayi ve Ticaret A.Ş. (TVF) us-
ing their privileged rights. Four of those
5 members are also to be nominated
by TVF. There are no privileges fore-
seen for the election of the remaining
4 members, including 3 independent
board members. The term of mem-
bership for the Board of Directors is
a maximum of 3 years and the Chair-
man of the Board of Directors has no
executive function. The Chairman of
the Board of Directors is elected from
among the 5 members for whom TVF
has privileged voting rights, in accord-
ance with the privileges set forth in
the Articles of Association. On Janu-
ary 29, 2021, our Company’s Board of
Directors decided to appoint Ms. Figen
Kılıç as a Board Member to the seat,
which became vacant following Ms.
Ingrid Maria Stenmark’s resignation,
pursuant to Article 363 of the Turkish
Commercial Code. There is a total of
6 members, 5 being male and 1 being
woman member in the Turkcell Board
of Directors. There are five commit-
tees established as per CMB legisla-
tion that report to the Board of Direc-
tors. The Board of Directors publishes
the “Corporate Governance Principles
Compliance Report” within the annual
reports and transparently discloses in-
formation on any incompliance issues
to our stakeholders.
You can access further details on the
Board Committees, their duties and
members in the Corporate Govern-
ance Principles Compliance Report or
on our website.
Chaired by the Chairman of Turkcell
Board of Directors, the Turkcell Inte-
grated Value Creation Committee was
established at Senior Management
level to regularly report its activities
to the Board of Directors and inform
relevant Board Committees when nec-
essary. Turkcell Senior Management is
responsible for the activities carried
out as part of integrated value crea-
tion and integrated reporting, under
the supervision of the Turkcell Board of
Directors. Turkcell Senior Management
pays utmost attention to the adoption
of transparency and reliability princi-
ples while overseeing the integrated
value creation process and the con-
tent of the integrated annual report.
The Integrated Value Creation Com-
mittee reports the activities carried
out within the scope of environmen-
The Turkcell
Sustainability
Committee reports to
the Board of Directors
through the Integrated
Value Creation
Committee on all
activities and outputs
carried out within the
scope of determining
and effectively
implementing short
and long-term action
plans in line with
environmental, social
and governance
policies, determining
material sustainability
issues, risks and
opportunities.
tal, social and governance policies to
the Board of Directors and receives its
approval, in a manner to be disclosed
publicly through the integrated annual
report on a yearly basis.
The following can be listed among the
responsibilities of the Integrated Value
Creation Committee of Turkcell Group;
• Providing direction for report plans
within the scope of the integrated val-
ue creation process and the integrat-
ed report,
• Reviewing the integrated value cre-
ation process in line with Turkcell’s
strategy,
• Giving direction to the content of the
integrated report and providing opin-
ion on its draft content.
The Turkcell Sustainability Commit-
tee reports to the Board of Directors
through the Integrated Value Crea-
tion Committee on all activities and
outputs carried out within the scope
of determining and effectively imple-
menting short and long-term action
plans in line with environmental, social
and governance policies, determining
material sustainability issues, risks and
opportunities.
Turkcell’s policies evaluated within the
scope of ESG are established by the
Sustainability and the Integrated Value
Creation Committees, decided on and
approved by our Board of Directors,
and published on the Turkcell Sustain-
ability website. Turkcell Human Rights
Policy and Environmental Policy were
approved by the Board of Directors
decision dated January 29, 2021.
https://www.turkcell.com.tr/en/abou-
tus/corporate-social-responsibility/
sustainability
The Integrated Value Creation Com-
mittee was established in order to
integrate our Company’s ESG policies
with our short and long-term goals
and strategies. The committee
is
chaired by the Chairman of the Board
of Directors of the Company. The goals
and strategies, which are determined
by the committee, are communicated
to the public on the Turkcell website
through our integrated report and CDP
report.
Moreover, system infrastructure estab-
lishment regarding our transition pro-
cess to ISO 14001 Environmental Man-
agement System had been started.
Among the economic, environmental
and social agreements, principles and
other initiatives that are supported
by our senior management and that
we are a signatory to are; the United
Nations Global Compact (UNGC), the
United Nations Development Program
Business Call to Action (UNDP BCTA)
Program and the United Nations Wom-
en Empowerment Project (UN WEPs),
GSMA’s Digital Declaration on Climate
Change, mPower Youth initiatives and
the Business Council for Sustainable
Development Turkey (BCSD Turkey).
Turkcell integrated value creation governance mechanism:
Board of Directors
Integrated Value
Creation Committee
Sustainability
Committee
Project
Teams
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Strong corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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Trends and their impacts
2020 has been a turning point for the industry in which we operate. It highlighted the exciting and fun-
damental trends of recent years such as technological developments, changing economic structures and
evolving social needs. As Turkcell, we closely follow up on those trends, as well as issues such as COVID-19,
mobility and climate change, and shape our business model and strategy to accurately address and man-
age such issues. As we have to date, so too in the future do we aim to introduce our country and our people
with the latest technologies via our domestic and national digital services developed by our engineers and
software developers. We further aim to contribute to the digital transformation of our country and create
value for all our stakeholders with our innovative and value-added solutions. While evaluating and analyzing
such global trends, we make use of publicly available sources such as industry reports and opinions, as well
as the reports of international organizations. This section includes insights into the prominent trends and
Turkcell’s approach to managing them.
Switching to 5G
Mobile communication technologies,
which are renewed with a new gen-
eration approximately every 10 years,
continue to achieve developments at
full speed in today’s world. 4.5G tech-
nology, the standards of which were
defined in the 2010s, and which has
been used in our country since 2016,
meets the high bandwidth demand of
our customers. According to a Global
Mobile Suppliers Association’s (GSA)
report, Turkcell is among the top 5
operators in the world to provide the
highest speed in 4.5G technology as
of May 2020. With 5G, standards of
which are currently being determined,
and with the innovative solutions it will
lead to, the download speeds that
will reach the level of gigabits per sec-
ond, autonomous vehicles, virtual re-
ality, augmented reality, remote health
and education services, remote work-
ing and Internet of Things (IoT) will be
further integrated into our lives. More-
over, 5G technologies are expected to
contribute USD2.2 trillion to the global
economy between 2024 and 2034,
and global 5G connections are ex-
pected to reach 1.8 billion by 2025*.
Apart from the telecom sector, 5G
also opens the door to fundamen-
tal changes in various sectors such
as health, automotive, entertainment
and services. As a software-based
technology, which will be central to
several sectors, 5G is to drive strate-
gic change in the way countries and
corporations view communication
technologies. Although the frequen-
cies used for wireless communications
in our country are technology-neutral,
the frequencies required to implement
the innovative solutions offered by 5G
value proposition and meet expecta-
tions, have yet to be allocated by the
ICTA.
How do we manage?
We work on this technology over
the 5G test networks we established
in select cities using the temporary
5G test frequencies allocated by the
ICTA. In those test areas, we analyze
the transition of our 4.5G network to
5G, observe 5G network performance
and examine 5G network products.
Moreover, we contribute to the de-
velopment of local 5G infrastructure
with the “End-to-End Domestic and
National 5G Communication Network”
Project that we signed as a stake-
holder in 2017, and which is carried
out within the scope of Communica-
tion Technologies Cluster (HTK) activ-
ities and supported by TÜBİTAK. With
our 5G test networks, we not only
experience the technology itself, but
also aim to establish a domestic and
national 5G digital ecosystem by im-
plementing 5G solutions for different
vertical sector business models. We
are happy to be the pioneer of numer-
ous 5G studies in our country for this
purpose so far. We have taken various
important steps in using 5G technolo-
gy ranging from communicating with
drones to pre-medical intervention to
a patient while in the ambulance, from
the first live TV broadcast over 5G to
the VR experience in sports competi-
tions. Using our 5G test networks, we
will continue to lead the establishment
of a domestic and national 5G digital
service ecosystem. Moreover, with our
5G R&D team, established in 2017, we
participated in numerous national and
international projects on focus areas
determined in the 5G area and devel-
oped projects with our own resources.
We have created a wide ecosystem
through collaborations with regulato-
ry and standardization organizations
and universities and research insti-
tutions, and by working closely with
many local and foreign institutions
and organizations, including compa-
nies from various sectors. We actively
undertook the Vice Presidency role in
the “Machine Learning for Future Net-
works including 5G” focus group, es-
tablished under “ITU-T Study Group
13 - Future networks with a focus on
IMT-2020, cloud computing and trust-
ed network infrastructure (SG13)” that
took place between February 2018
and June 2020. Furthermore, we con-
tinued to support the development of
technology by actively participating in
the “Technologies for Network 2030”
focus group established to work on
6G issues in SG13.
* GSMA
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Big data
As the world comes to terms with the
Industry 4.0 revolution, the business
world is at the adaptation stage to
this new era, where all information
is instantly shared via the Internet of
Things and creating big data, through
digital transformation. Even though
numerous companies recognize the
potential value of big data, these
companies still need to transform
their technological infrastructure so
as to benefit from the opportunities
that can be achieved with big data
predictions.
In the telecommunications world, a
large amount of data is produced
every day through social media net-
works, connected devices, customer
behavior, government service portals,
call data records, billing information
and similar sources. As a result, it is
becoming increasingly difficult for
mobile operators to cope with rapid
fluctuations in data volumes. While
leading to difficulties for the tele-
communications industry in terms of
technical infrastructure requirements,
big data also offers the opportunity
to turn this challenge into an oppor-
tunity with big data analytics appli-
cations.
How do we manage?
As Turkcell, we provide our corpo-
rate customers the opportunity to
understand the shopping habits of
potential customers and reach them
with our big data analytics services.
Big data also enables us to interpret
changes in the shopping habits of ex-
isting customers, and accordingly to
offer the most appropriate solutions.
Our Big Data Analytics Consultants
work to determine the characteristics
of our existing and new customers
with customer profiling studies. We
also prioritize studies to increase the
loyalty of existing customers. Thus,
with big data, we can understand
the needs of our existing, new and
old customers, and increase our rev-
enue with new value proposals. We
are aware of the need to interpret
the correct customer data in order to
reach the target audience and make
the right investments, and we contin-
ue growing our business by doing so
with big data.
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Climate change
Global warming, which threatens the
existence of life on earth and the im-
pacts of which are felt more inten-
sively each day in diverse perspec-
tives from daily life to government
policies, mainly results from human
activities. Global warming triggers a
series of chain reactions in economic,
ecological and social life and causes
global migration crises, resulting in an
obstacle to economic activities, and
epidemic diseases arising from the
destruction of biological diversity. We
acknowledge that climate change
and biodiversity risks are interde-
pendent. As a recent example, scien-
tific studies show that COVID-19 has
been mainly caused by issues associ-
ated with natural capital. With global
warming continuing at an escalating
pace, the studies indicate that all
these interconnected problems will
further escalate due to pandemic
risk, climate risk and biodiversity risk.
Considering forest fires, flood dis-
asters and incidents related to de-
struction of biodiversity, which have
increased in frequency all over the
world in recent years and have be-
come extremely difficult to control,
World Economic Forum (WEF) de-
fined the top five global risks in terms
of probability as climate-related risks
in its 2020 Global Risk Report. In or-
der to manage these risks effectively,
businesses need to achieve net zero
emissions rapidly and focus on the
implementation of circular, renewa-
ble and regenerative strategies.
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Digital transformation and inclusion
While the speed of accessing and
processing
increases
information
with rapidly developing mobile com-
munications technologies, the de-
pendency on physical locations and
assets decreases. These dynamics
create valuable new opportunities for
many individuals and institutions. The
rapid and intense increase in global
transactions over the internet with
the COVID-19 pandemic shows that
new business models are to emerge
that will potentially add value to the
lives of users. According to a Forbes
article, as of April, there was a year-
on-year growth of 129% in e-com-
merce orders in the USA and Cana-
da. The fact that many companies
started working remotely due to the
pandemic, and that such applica-
tions were successful, suggests that
remote working will continue par-
tially after the pandemic. This shows
that the importance of services and
applications in the field of commu-
nications will continue to rise in the
upcoming periods.
Digitalization reduces the distance
between people in different countries
and rapidly increases the accessibil-
ity of digital applications, products
and services. Mobile communica-
tion services cover 5.2 billion people
around the world, corresponding to
67% of the world’s population. The
number of people with access to in-
ternet through mobile applications
has reached 3.8 billion, making the
telecom sector one of the most ef-
fective channels for digital services
to reach people. The telecom sector
has great potential for eliminating in-
equalities around the world and for
providing access to information and
services, including financial services.
Over the past 20 years, mobile tech-
nologies have accounted for about
10% for every USD100 increase in per
capita income.* Additionally, with the
mission of providing access to digi-
tal services, the telecom sector can
pave the way for social development
for various socio-economically dis-
advantaged groups, including wom-
en and the youth.
How do we manage?
As Turkcell, since our establishment,
we have placed technology’s power
to provide equal opportunities at the
center of all our social responsibility
projects, having implemented pro-
jects that aim to ensure equal op-
portunities in information access for
all. Using our strong analytical com-
petencies, we develop high quality
and innovative products, services and
projects, and offer services in many
areas from education to finance.
We continue our rapid improvement
in the mobile payment field with our
Paycell application, which has been
positioned as a new generation super
app, with over 9 million downloads to
date. Within the scope of our digital
services, we offer solutions that meet
the needs of our customers with our
products including TV+, fizy, BiP and
lifebox. We support the digitalization
journey of institutions by offering dig-
ital business services. In areas where
the infrastructure is insufficient to de-
liver fiber internet, we can provide
fast and secure internet access for
everyone via our Superbox product
offering fiber speed internet. With the
Whiz Kids project, we bring special,
talented students together with tech-
nology and science. Moreover, we
offer our My Sign Language applica-
tion, which instantly translates what
is written and said into sign language,
free of charge for all operators’ users.
How do we manage?
Climate change risks directly affect
Turkcell’s business operations. As Turk-
cell, we conduct field risk analyzes
during the installation of base sta-
tions. We take measures against the
risks of extreme weather events and
natural disasters caused by climate
change, and plan for the transfer of
data centers to locations with cold
climates, foreseeing a rise in average
air temperatures in the long term.
* GSMA
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You can access more
information on Turkcell’s efforts
regarding the Climate Change
trend in the “natural capital
section” of the report.
For our energy-focused activities,
we turn to environmentally friend-
ly green energy resources within the
framework of Sustainable Develop-
ment Goals. We have implemented
our Turkcell Sustainability Strategy in
2020, in line with our goals of meet-
ing all our electricity demand from re-
newable energy sources by 2030 and
becoming a carbon neutral company
by 2050.
SDG 13.b
SDG 7.2
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Mobility
Fundamental trends such as autono-
mous driving technologies, connec-
tivity, electrification and car sharing
are shaping the present and future
of mobility concepts. The idea has
gained momentum and become
widespread that the developments in
mobility field will affect many factors
ranging from the cities we live to the
roads we use as well as the compa-
nies operating in this area. Moreover,
it is anticipated that the concept of
mobility will not only trigger signifi-
cant changes in the automotive and
transportation sectors, but also in the
technology sector. In the aftermath
of the COVID-19 pandemic, mobility
is expected to contribute to econom-
ic recovery and create opportunities
for digital technologies, as well as
new employment.
Rapid developments
in mobili-
ty trends and technologies have
brought our country to the edge of
a new era. The transportation sec-
tor, which focuses on developing
new technologies, works on flexible
and innovative solutions to specific
needs. KPMG Turkey’s report, issued
in September 2020 providing insights
on the development of mobility sec-
tor in Turkey, indicates the advan-
tage of utilizing lithium from its own
mines will position Turkey favorably
in the development of electric vehi-
cle market, where we will participate
with the domestic and national vehi-
cle. The TOGG project, Turkey’s first
domestic car to be designed as an
electric vehicle, marks an important
and powerful initiative in the mobility
sector.
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Regulatory developments and sector regulations
Telecommunications sector activities
are closely monitored and regulat-
ed as freedom of communication
is defined as a constitutional right,
and telecom is among the most crit-
ical sectors in our country. Moreover,
ensuring effective and competitive
market dynamics and helping cus-
tomers with the desired level of dig-
ital experience requires the active
participation of sector players, NGOs
and regulatory authorities. In order
to unlock the potential of electron-
ic communication technologies and
develop innovative services meeting
customer needs, sectoral regulations
should support the development of
the digital economy, and ensure fair
competition and investment environ-
ment.
How do we manage?
Our mobility solutions, offered as part
of digital business services, incorpo-
rate the most advanced vehicle and
fleet technologies for improving the
safety of vehicles as well as employ-
ees. “Turkey’s Automobile Initiative
Group” announced the development
of Turkey’s domestic automobile,
TOGG, in December 2019, with its
design and roadmap subsequently
determined. Preparations for Turkey’s
domestic and electric automobile
continue at full speed with the con-
sortium consisting of five large com-
panies, including Turkcell, and the
TOBB partnership.
As Turkcell, we contribute to the se-
curity of the information network, and
invest in cyber security and data pri-
vacy fields accordingly. We consider
this critical for both mobility service
developers as well as institutions
and individuals benefiting from those
services. Having adopted domestic
approach on software development
and hardware production, and lever-
aging our data centers we prepare
the technical infrastructure that com-
panies will need in the upcoming pe-
riod for mobility solutions.
How do we manage?
As Turkcell, we keep our activities and
continue expansion in the global mar-
ket by managing disputes effectively
and taking preventive legal actions,
while building business strategies on
solid legal foundations. The digitaliza-
tion of our processes helps us add va-
lue to our leadership journey and the
reputation of Turkcell and our Group
companies. We consider public insti-
tutions and regulatory authorities an
essential part of our ecosystem. The-
refore, we contribute to all legislative
work that directly or indirectly con-
cerns our industry at all stages as an
active stakeholder by focusing on the
continuity of a sustainable ecosystem
and customer welfare. We are aware
that regulatory developments have
the potential to directly affect our
business model and strategies. We
pursue our activities in accordance
with our goal of creating value for our
country and our industry by working
in cooperation with regulatory autho-
rities and relevant stakeholders.
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Sustainable financing activities
Sustainable Finance relates to fi-
nancing activities where funding can
be accessed based on a range of en-
vironmental, social and governance
criteria. The climate crisis has led to
the rising importance of non-finan-
cial risk factors for investors, and re-
porting on these factors has become
widespread accordingly. With the
support of the United Nations Glob-
al Compact, companies have started
to manage their business strategies,
corporate finance and investment
activities in accordance with the tar-
gets determined within the frame-
work of the SDGs.
In parallel to the increasing risks as-
sociated with climate change, sus-
tainable borrowing instruments are
expected to expand, while banks will
set stricter rules on the sustainabili-
ty performance of the projects they
finance. According to KPMG’s re-
port “The numbers are changing the
world”, 34% growth was registered
in ESG impact investments between
2016 and 2019, and the ratio of sus-
tainable investment to total man-
aged assets in Europe reached 48.8%.
The “European Green Deal”, issued at
the end of 2019, underlines the critical
importance of sustainable financing
activities for financing investments
implemented
and projects to be
within the scope of the long-term
plan.
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The development of fintech applications
The accelerated digitalization, wid-
er use of cryptocurrency and block-
chain and the rising global smart-
phone penetration provide a conven-
ient environment for the development
of financial technologies (fintech).
According to the KPMG report “Pulse
of Fintech”, the fintech field has made
a significant improvement with the
doubling of investments in the field
between 2018 and 2019 compared to
the period between 2014 and 2017.
After the mega mergers and acqui-
sitions realized in fintech field in 2019,
investments in fintech-related servic-
es such as digital banking and con-
tactless payment systems rose with
the effect of the COVID-19 pandemic,
especially in the first half of 2020, and
fintech investments reached USD25.6
billion in the first quarter of 2020.
Smartphones, which are the prima-
ry means used for internet access
by people, play a facilitating role for
many technologies and services, in-
cluding fintech. Fintech and mobile
services have the potential to provide
access to financial resources and
services for the unbanked popula-
tions. As the World Bank’s 2017 Findex
report indicates, access to the finan-
cial systems provides the opportuni-
ty of financial and social independ-
ence, especially for those deprived
of certain fundamental needs such
as having a bank account, and also
for women, corresponding to 56% of
adult population. As 44% of its popu-
lation does not have a bank account
according to the
Interbank Card
Center (BKM), Turkey has great poten-
tial in the fintech field with its young
population and high smartphone use
ratio. Through the legislative change
that took effect as of July 2020, the
concept of “Open Banking” has also
taken root in Turkish banking legisla-
tion as a key step for fintech. Thus,
the regulatory environment in Turkey
has become more convenient for the
development of fintech applications.
How do we manage?
In the Turkcell ecosystem, fintech
is referred to as techfin in terms of
our focus on technology, and tech-
fin activities are carried out through
our three subsidiaries; Paycell, Finan-
cell and Turkcell Insurance. Leverag-
ing our experience of over a quarter
century, superior digital services and
advanced analytical capabilities, we
closely follow the innovations in the
techfin field and develop pioneering
products and solutions.
Paycell, being Turkcell’s new gen-
eration payment platform, is full of
opportunities for both individual and
corporate customers in the mobile
payment field. Paycell application
has been downloaded over 9 million
times. While services such as mon-
ey transfers and payments can be
readily realized through the Paycell
application, we provide payment fa-
cilitation services to over 12 thousand
contracted merchants with solutions
including QR-based payment and
mobile POS. Financell, our financ-
ing service that facilitates individual
and corporate customers’ access to
technological products, has extended
loans in the amount of TRY18 billion
to approximately 5.6 million custom-
ers since its foundation. At Turkcell
Insurance, through our innovative ap-
proach in the insurance arena, we
provide customers convenient, simple
and fast insurance services.
How do we manage?
As we are well aware of the in-
creasing transparency and reporting
expectations of investors on ESG is-
sues, we began preparing our annual
report using the integrated reporting
structure as of 2020.
We focus on sustainable financing
options to diversify our funding op-
tions, support our sustainability ac-
tivities and provide access to finance
with more favorable conditions. In
this context, we utilized the “Sustain-
ability Indexed Loan” in 2019 and ob-
tained a “Green Loan” in 2020. These
transactions enable us to conduct our
business and investments in accord-
ance with the realization of the SDGs.
Meanwhile, we continue our activities
as one of the founding members of
the UNGC CFO Taskforce, which aims
to create a market for investments
towards the SDGs.
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Cyber security
Despite numerous advantages, the
increased use of technology and the
acceleration of digital transformation
in the business world expose organ-
izations to cyber security risks. The
impacts of the COVID-19 pandemic
have forced organizations to use dig-
ital platforms and tools, while testing
them in terms of cyber security issues.
transformation permanent-
Digital
ly changes the way companies do
business, especially during the pan-
demic period, and will continue to
do so in the upcoming periods. Thus,
cyber security emerges as a dynam-
ic field comprised of numerous dif-
ferent components. The increase in
cyber security threats underlines the
importance of information security
for organizations.
How do we manage?
We carry out activities at the nation-
al and international fronts to develop
measures, which will help identifying
threats, reducing and eliminating the
effects of possible attacks and inci-
dents, and to share those measures
with identified bodies. We build se-
cure infrastructures and systems by
improving our processes, creating
awareness, developing qualifications
of our human capital, setting up lay-
ered security controls and using new
generation technologies. With the
Turkcell Security Operations Center,
working 24/7, we monitor current
threats and cyber-attacks, and take
the necessary actions by apply-
ing end-to-end security checks and
tests. Thanks to our digital operator
competence, we offer our experience
in cyber security and information se-
curity to our individual and corpo-
rate customers as a service via the
Turkcell Security Operations Center
operating 24/7. We continue to meet
the needs of institutions, organiza-
tions and individuals in diverse are-
as including ensuring cyber security,
protecting data, and establishing in-
tegrated infrastructure.
Artificial intelligence
Artificial intelligence (AI) has become
a term that refers to applications and
software that perform significantly
more complex tasks than any other
functions
leveraging solely human
capital. Being among the top agenda
items of the decision-making mech-
anisms of institutions and organiza-
tions, artificial intelligence technolo-
gy is reshaping company strategies.
Many companies make significant
investments in data science teams
to benefit from the opportunities and
values offered by AI. There are numer-
ous application examples confirming
its value. Moreover, organizations are
able to improve user experience and
increase productivity by integrating
machine learning and cognitive in-
teractions into traditional business
processes and applications software.
KPMG published the “Living in an AI
World” report in 2020, which exam-
ines the business world digitalized by
artificial intelligence. According to the
study included in the report, 92% of
participants are of the opinion that
artificial intelligence-based technol-
ogies will enable their companies to
be more efficient, while 73% believe
that more aggressive decisions are
required in relation to their compa-
nies’ artificial intelligence investments
and adaptation processes.
In the telecom sector, issues such as
meeting the rising demand in terms
of product and service diversity, the
subscribers’ customized digital needs,
coverage area and bandwidth as
well as the intensified competitive
environment are growing in impor-
tance, while artificial intelligence is
anticipated to play a key role in of-
fering solutions for those areas.
How do we manage?
In January 2020, as Turkcell, we an-
nounced seven principles that we will
comply as part of our activities in ar-
tificial intelligence, which is expect-
ed to be the focus of technological
developments. As the first company
taking this step in Turkey, we have
joined global players that contribute
to artificial intelligence ethics. In our
country, we played a leading role at
the turning point for artificial intelli-
gence, which will be the most popular
technological concept over the next
decade and impact the global leader-
ship claim of countries. As part of our
offers and services, we interpret the
big data gathered from our activities
with artificial intelligence and provide
our customers with customized offers
leveraging our analytical capabilities.
Using machine learning techniques in
various areas such as traffic density,
capacity management and anomaly
detection in our network, we contrib-
ute to the efficiency of our infrastruc-
ture. We offer our artificial intelligence
solutions to institutions and organiza-
tions through our Digital Business Ser-
vices company. Our legal and regula-
tory team has long been collaborating
with global organizations to eliminate
concerns over artificial intelligence,
and also to increase its positive im-
pact. Turkcell plays an active role in
international platforms on which the
principles and future of artificial intel-
ligence are elaborated. In this context,
we have contributed to the following
studies among others; global princi-
ples on children’s rights and artificial
intelligence and the responsible use
of facial recognition systems. We also
collaborated with the world’s leading
standardization organization IEEE with
regards to the determination of eth-
ical standards in artificial intelligence
systems that process emotions as part
of the “Standard for Child and Stu-
dent Data Governance” and “Standard
for Age Appropriate Digital Services
Framework” projects. We also take
part in ITU’s working group on smart
cities, as well as artificial intelligence
and health working groups. Further-
more, we contributed to the World
Economic Forum’s “A Framework for
Responsible Limits on Facial Recog-
nition Use Case: Flow Management”
project. Turkcell acts with utmost care
within the framework of the Law on
the Protection of Personal Data and
continues to work complying with its
declared principles to ensure that arti-
ficial intelligence brings value to both
our customers and the world.
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The growing need for communication due to COVID-19
As of the end of 2020, the COVID-19
pandemic has affected more than 80
million people worldwide resulting
in over 1.7 million deaths. The esti-
mated economic contraction for year
end 2020 is around 4.4%, and this is
expected to bring serious socio-eco-
nomic consequences. The World
Bank’s October 2020 estimates re-
vealed that the COVID-19 pandemic
is expected to place 88-100 million
people in extreme poverty in 2020.
The dynamics that emerge with
the pandemic have already caused
changes
in many areas. Remote
working has become predominant
while in-person learning is being re-
placed with distance learning. More-
over, we see reflections of changes in
consumer preferences affecting nu-
merous sectors from transportation
to retail and distance entertainment.
A study conducted by ACI reveals
that the online retail shopping ratio
increased by 74% worldwide in the
first months of the pandemic. Mean-
while, remote healthcare services
are also increasing rapidly. These
trends point to increasing demand in
the mobile communications industry.
New technologies, especially includ-
ing 5G, are expected to play a critical
role in meeting such demand.
How do we manage?
In parallel with the developments in the
COVID-19 pandemic, we analyze new
dynamics in the most efficient manner
and respond quickly to the changing
needs of our customers and society.
As the importance of telecom services
has risen significantly due to the rising
demand for distant education, health
and entertainment services, we have
improved our infrastructure and in-
creased our support to prevent any
service disruptions. We supported dis-
tance learning by providing additional
data quotas for students and teach-
ers. We doubled the monthly internet
quota to 6 GB for “teachers and stu-
dents” who will benefit from the EBA
(distance education platform) infra-
structure. We donated 15 GB data al-
lowance and 15 thousand minutes for
three months to ensure that the field
personnel of the Ministry of Health can
work without communication disrup-
tions. During the transition period to
remote working, we provided over
1,600 corporate customers, some of
which are among Turkey’s largest en-
terprises, the opportunity to manage
data centers remotely. We also stood
by our customers through our digital
services. BiP Meet offers a secure vid-
eo conferencing experience for online
meetings, while TV+ enables users to
watch TV channels and movies. We
offer fizy for music lovers, magazine
applications for those who keen to
read newspapers and magazines,
as well as Yaani search engine, and
Paycell for secure and fast payments
without touching money or credit card.
Moreover, all of these applications can
be used by all operator users.
You can access more
information on our practices
related to COVID-19 throughout
the report in COVID-19 note
sections.
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Effective risk and
crisis management
The importance of
effective risk and
crisis management to
mitigate the macro-
economic uncertainties
observed over recent
years, and especially in
2020 with the impact
of pandemic, has once
again proven vital.
Effective Risk and
Crisis Management,
a priority for both our
Company and our
stakeholders, enables
the management of
risks that may impact
the achievement of
Company targets
determined in line
with our strategies,
within the scope of
the Corporate Risk
Management (CRM)
system. While doing
so, a pro-active risk
management policy is
adopted that turns risks
into opportunities.
SDG 16.6
Risk management and Internal
control mechanism
In selecting an
independent audit
company; the Audit Committee con-
siders the competencies and impar-
tiality of independent audit firms and
presents its suggestion to the Board of
Directors.
During our Company’s Ordinary gen-
eral assembly meeting held on Octo-
ber 21, 2020 PwC Bağımsız Denetim
ve Serbest Muhasebeci Mali Müşavir-
lik A.Ş. (PricewaterhouseCoopers) was
appointed as the Company auditor
for the auditing of our Company’s fi-
nancial statements of 2020, as per the
Turkish Commercial Code (TCC).
The Internal Audit function within the
Company directly reports to the Board
of Directors and is responsible for the
auditing of Turkcell İletişim A.Ş. and all
group companies, which are subsidiar-
ies, and reporting the results of audit
activities carried out in step with Inter-
national Standards for the Professional
Practice of Internal Auditing to the Au-
dit Committee. The auditing activities
of the Internal Audit mainly comprise
operational audits conducted pursuant
to annual risk-based audit plans and
audits in accordance with compliance
to Article 404 of the Sarbanes Oxley
Act.
Operational audit activities are carried
out according to annual audit plans
prepared with respect to a risk-based
audit approach. Through conducting
operational audits, the Internal Au-
dit evaluates the effectiveness of risk
management, control, and governance
processes, providing assurance to the
Board of Directors and Audit Commit-
tee in this respect, and thereby assist-
ing Turkcell in meeting its goals.
Meanwhile, as we are listed on the
New York Stock Exchange in the Unit-
ed States, and as per the provisions
of Article 404 of the Sarbanes Oxley
Act, which all publicly-traded compa-
nies are required to comply with, au-
dit activities are conducted within the
framework of the annual plan to pro-
vide assurance in terms of the exist-
ence, adequacy and effectiveness of
the internal control system adopted by
Turkcell and Turkcell group companies,
the financial statements of which are
consolidated. All stages, covering the
planning of audit activities, identifying
internal control insufficiencies, and fol-
lowing up and closing related actions,
are carried out in accordance with the
aforementioned article, and regularly
reported to the Audit Committee, CEO
and CFO.
The Internal Audit Unit also provides
consultancy services with respect to
matters at hand, as well as matters
raised by the management.
The Internal Audit Unit reports on com-
pliance practices as per Article 404
of the Sarbanes Oxley Act to the Au-
dit Committee, CEO and CFO, while
the Enterprise Risk Management Unit
reports its activities to the Early De-
tection of Risks Committee. The Inter-
nal Audit mechanism operates with a
risk-based audit approach. Within this
scope, functionally and institutionally
probable risks are continuously mon-
itored, with the risk analyses resulting
from these conducted operations con-
stituting the main input of audit activ-
ities.
Since the end of the financial year
of 2012, the “Early Detection of Risks
Committee” has been in operation to
perform activities in a manner affiliat-
ed with the Board of Directors within
the scope of article 378 of the Turkish
Commercial Code and the Commu-
niqué on Corporate Governance of the
Capital Markets Board. The Early De-
tection of Risks Committee supports
the Board of Directors by performing
studies for the purpose of the early de-
tection of risks that may jeopardize the
In order to increase
the effectiveness
of the Turkcell
Crisis Management
Plan, regular drills
are conducted,
and trainings and
awareness activities
are held with the
participation of Crisis
Management Teams
and related groups.
existence, development and continuity
of the Company, implementing the
necessary measures related to identi-
fied risks and managing of those risks.
The Committee reports to the Board
of Directors once every 2 months and
these reports are shared with the in-
dependent audit company. The Board
of Directors regularly provides an
evaluation of the risks affecting the
Company through the Early Detection
of Risks Committee. According to the
Turkcell Corporate Risk Management
approach, risks that are assessed as
“Very High” and “High” upon Impact
and Probability scale risk assessment
are monitored together with business
owners every two months. These risks
are brought to the Early Risk Detection
Committee and necessary actions are
taken. Medium and Low-level risks are
assessed together with risk officers
and followed up in the Enterprise Risk
Universe through the monitoring and
tracking system. The very high and
high risks that are raised at risk anal-
ysis meetings are re-evaluated prior
to each presentation and presented
to the Early Risk Detection Commit-
tee, which consists of members of the
Board of Directors.
The Enterprise Risk Management team
is responsible for assessing risks and
reporting risk prevention activities to
the Early Detection of Risks Commit-
tee, as well as coordinating the risk
prevention activities within Turkcell
and its group companies through the
Corporate Risk Management method-
ology. Each director is responsible for
the Enterprise Risk Management activ-
ities in her/his unit. The Enterprise Risk
Management team carries out risk
management duties together with di-
rectors, managers who directly report
to vice presidents, and risk contacts.
The Turkcell Enterprise Risk Manage-
ment team has adopted an approach
whereby the risk management pro-
cess is integrated with fundamental
management processes. In so doing,
a framework associated with the pro-
cess was identified in accordance with
an Enterprise Risk Management proce-
dure as per the COSO ERM framework
and ISO 31000 standard.
In 2000, Turkcell formed its business
continuity plans in a manner also en-
compassing its technical operations,
repositioning
its business continuity
plan as Business Continuity Manage-
ment by broadening the extent thereof
in 2004.
With the restructuring in 2011, the
scope of the program expanded to
comprise Turkcell Group companies
and suppliers. The Turkcell Group Busi-
ness Continuity Management System
has been structured and certified in a
manner ensuring the continuity of our
call, messaging, internet, server servic-
es, data centers and societal security
services as per the international “ISO
22301, Societal Security - Business
Continuity Management
Systems”
standard. Regular drills are conducted
to test our business continuity plans,
drafted in consideration of customer
expectations, corporate policies and
legal obligations, so as to guarantee
their sustained operation in case of
emergency or disaster.
Our geographically dispersed tech-
nical infrastructure, extensive cover-
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Technological
developments are
followed through
collaborations with
important international
sectoral organizations
such as GSMA, as well
as through competent
R&D studies and
projects at national
and international levels.
age, solution partner network, mobile
network, mobile base stations, addi-
tional capacity, emergency centers
and extensive experience in handling
emergencies enable us to minimize
risks. Additionally, the experience of
our Group companies in customer
services, our high-speed fiber-optic
infrastructure, data storage services
and our experienced software devel-
opment teams allow us to effectively
manage any disasters from another
center, thereby ensuring the continuity
of our activities.
Turkcell’s Crisis Management Plan cov-
ers seven major events; operational
disruptions, natural disasters (earth-
quakes, floods, etc.), cyber-attacks,
terrorism, fire, pandemic and epidemic
and toxic events. In order to increase
the effectiveness of the Turkcell Crisis
Management Plan, regular drills are
conducted, and trainings and aware-
ness activities are held with the partic-
ipation of Crisis Management Teams
and related groups.
Information security risks
Data security risk: This includes the
risks of theft, loss, leakage, deliberate
or accidental disclosure, misregistra-
tion, alteration, deletion, destruction
and inaccessibility of any information
stored both in physical and/or in elec-
tronic media via authorized/unauthor-
ized access from within or outside of
the organization. In response to risks
associated with data security, Turkcell
takes the necessary technical and ad-
ministrative measures.
Cyber security risk: This involves the
risk of destruction of information sys-
tems and of damage to systems due
to the malicious use of Turkcell’s inter-
nal and external computer and net-
work systems. In this context, Turkcell
manages vulnerabilities by implement-
ing end-to-end security controls and
tests. The Security Operations Center
monitors threats 24/7 and performs
Cyber Attack Monitoring and Defense.
Financial risks
Macroeconomic risks: This includes the
risk of worsening expectations and/or
the current situation due to econom-
ic and political uncertainties. Turkcell
already diversifies its financing sourc-
es and keeps different resources and
necessary agreements ready, in the
event of cases of possible sanctions
and regional inability to access certain
resources.
Currency, interest and inflation risk: This
includes the risk of increasing costs
and decreasing income due to fluctu-
ations in inflation, and interest rate and
exchange rates. In this context, market
dynamics are closely monitored, and
appropriate financial instruments are
selected and implemented to minimize
exchange rate risk.
Liquidty, financing risks: This involves
the risk of disruptions to cash flow due
to inaccessibility of financing resourc-
es utilized or intended to be utilized,
or inability to pay-back loans. Turk-
cell’s forward-looking cash projection
is systematically monitored with the
principles of effective balance sheet
and liquidity management.
Cash generation and collection risks:
This involves the risk of disruptions to
cash flow due to the inability to collect
existing receivables on time. In peri-
ods when collection risk increases for
certain reasons (economic crisis, pan-
demic, war, etc.), collection balances
and trends, as well as cash flow track-
ing are monitored and reported to
senior management on a daily basis.
Strategic risks
Investment risks and risk of adapta-
tion to technological developments:
These are the risks that can affect the
Company’s position, reputation and
image in the market and the sector
in the short, medium, or long term. In
this context, sectoral, local and glob-
al trends and competitor activities in
new business lines are closely moni-
tored and necessary actions are tak-
en. Technological developments are
followed through collaborations with
important international sectoral or-
ganizations such as GSMA, as well as
through competent R&D studies and
projects at national and international
levels.
Legal risks
Risks regarding compliance: This in-
volves the risk of encountering admin-
istrative sanctions as a result of failure
In order to prevent
employee mistakes
and more effectively
manage processes
and projects,
Turkcell Academy
identifies training
needs and plans
competency trainings
in areas of employee
development.
to comply with the applicable regula-
tions. Turkcell aims to monitor and pre-
vent any possibility of non-compliance
by closely following developing and
changing regulations with a pro-active
management approach. Within this
context, business teams are provided
with briefings and information with re-
spect to changes in legislations as well
as new regulations which are moni-
tored by senior management through
personal data steering committee,
compliance committee, sub-compli-
ance committee and information sys-
tems compliance committee; and rele-
vant compliance activities are carried
out in this respect. Moreover, various
measures are taken via digitalized
tools such as internal audit and auto-
mated control systems, working con-
tinuously, in order to prevent the occur-
rence of any breach and imposition of
any administrative sanctions.
Lawsuits and legal conflict risks: This
includes the risk of encountering sanc-
tions against the Company due to the
filing of a lawsuit related to the area of
responsibility. Legal activities are car-
ried out regarding those conflicts that
may arise against Turkcell regarding its
operations/contracts/projects.
Business continuity risks
These are the risks the Company may
encounter as a result of events includ-
ing operational interruptions, natural
disasters, terrorism, etc. Crisis, business
and service continuity plans within the
Company have been prepared metic-
ulously. In order to evaluate its effec-
tiveness and identify potential areas
for improvement, plans are reviewed
periodically, and regular drills are car-
ried out annually.
Operational risks
Risks arising from the environment,
sustainability and ecology: This in-
cludes issues that may arise due to
climate change (temperature chang-
es, increase in energy consumption,
increase in energy prices, insufficient
waste management, lack of protec-
tion of water resources, etc.) and risks
related to environmental factors that
may affect human health and biolog-
ical diversity. In this context, Turkey’s
first ISO 50001 certified mobile oper-
ator, Turkcell, is making extensive re-
through an
newable energy investments through
its subsidiaries and also tracking its
energy consumption. As an ISO 14064
(International Greenhouse Gas Calcu-
lation and Verification Standard) cer-
tified mobile operator, Turkcell calcu-
lates and verifies its greenhouse gas
independent
emissions
organization. Through its CDP Climate
Change reporting, Turkcell regularly
shares its climate change performance
and its approach to climate-related
risks and opportunities with its stake-
holders. Turkcell aims to be carbon
neutral by 2050, and continues its ac-
tivities to meet its target of sourcing
100% of its electricity consumption
from renewable sources by 2030.
Risks related to managing relation-
ships with third parties: This includes
risks that arise from inefficient man-
agement of third parties. These may
occur due to failure of third parties
in fulfilling their responsibilities com-
pletely and accurately, their activities
violating company procedures and
legal regulations, or their fraudulent
behavior. In order to minimize risk of
potential impact on operations and
targets, agreements are made with
business partners having obtained
legal opinion. In order to prevent em-
ployee mistakes and more effectively
manage processes and projects, Turk-
cell Academy identifies training needs
and plans competency trainings in ar-
eas of employee development.
Market risks
Macroeconomic and political uncer-
tainty risks: This includes the risks of
worsening expectations and/or the
current situation due to economic
effects such as the reflection of ex-
change rate fluctuations and inflation
on consumption habits of customers,
and of political uncertainties. Global
trends, economic indicators, competi-
tion, revenues and subscriber data are
regularly monitored by Turkcell.
Competition risks: This includes the risk
of being disadvantageous in compet-
ing activities or technological and/
or sectoral developments. In this con-
text, market and competitor activities
are closely monitored and efforts are
made to respond to such competing
activities with timely actions.
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102
Strategic initiatives
and opportunities
In evaluating global
trends and Turkey’s
growth potential, we
have determined three
strategic focus areas
in addition to our
core telecom business
that build on our four
main competencies.
In parallel to our
strategic focus
areas, we have four
main competencies
stemming from our 27
years of experience
and know-how, which
distinguish us from
other operators in the
sector and strengthen
our leader position.
While our strategic focus areas direct
our Company’s operations, we also
ensure that all business lines evaluate
opportunities in the most effective
manner.
Our strategic focus areas are re-eval-
uated annually through meetings and
surveys with the participation of em-
ployees from every level, and there-
fore, we ensure the consistent reflec-
tion of our strategy based on current
trends, opportunities and competen-
cies.
Our telecom business
• Rising trend for data usage in the
young customer segment: Consider-
ing the increasing mobile data usage
trend among young customers and
the trend towards mobilizing, we offer
various campaigns and develop new
applications and services through so-
cial media-oriented packages and
the GNÇ application for the needs of
our young customers.
• Market share increase in corporate
customer segment: As Turkcell, we fo-
cus on further increasing our already
large corporate customer market
share and benefitting from the op-
portunities brought by digitalization.
In this context, we prepare various
campaigns for tradesmen and SMEs,
especially given changing needs due
to the COVID-19 pandemic.
Digital services
• New revenue opportunities in traf-
fic and data usage with increasing
active users and transaction volume:
The number of active users of our ser-
vices is rising each day. Accordingly,
our transaction volumes, commission
revenues, advertising revenues and
subscriptions are also growing.
• The growing importance of mo-
bile applications with remote work-
ing: The COVID-19 pandemic has led
the world to work remotely. This has
increased the importance of com-
munication infrastructures, software
and the security of these systems for
companies. Remote working is antici-
pated to grow in popularity even after
the COVID-19 pandemic. As a leading
technology company equipped to
meet respective needs in this area,
we provide services via our products
such as BiP, Yaani Mail, lifebox and BiP
Meet to high security standards.
Digital business services
• Increasing demand for data centers
in accordance with regulations to
store personal data in our country: In
order to maintain data security and
ensure privacy of personal data, as
Turkey’s largest data center operator,
we continue our activities with the vi-
sion that Turkey’s data should remain
in Turkey. In this context, regulatory ar-
rangements concerning the storage of
certain data in Turkey have increased
the demand for our data centers, thus
helping us improve our business and
contributing to our revenues.
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• Global IT service providers to face
difficulty in price competition due to
currency impact: Due to the impact
of currency movements, we are in a
position to offer advantageous prices
for our digital business services com-
pared to foreign service providers.
• Absence of accepted major play-
ers in the new generation technolo-
gies market such as IoT and artificial
intelligence: We use our big data, IoT
and artificial intelligence (AI) expe-
rience and competencies in various
areas including the development of
products and services. The absence
of accepted major players in IoT and
artificial intelligence solutions, which
are still developing areas, creates an
advantage for Turkcell. The Republic
of Turkey’s national vision to encour-
age development of domestic and
national technologies, is considered
as an opportunity for Turkcell.
• The increasing importance of re-
mote health services, distance learn-
ing, remote working, and of products
and services in these areas: The in-
creasing need for remote solutions
during the pandemic period led to
increased demand for products and
services, which we focus on, in the
field of remote health, education and
working solutions.
You can access detailed
information in the intellectual
capital section.
• Opportunities arising from the need
for digital transformation in private
and public sectors: Digitalization of-
fers various opportunities for produc-
tivity and service quality increase for
companies and public institutions. As
Turkcell, we also offer end-to-end
digital transformation services via
customized solutions to Turkish com-
panies and public institutions, togeth-
er with financing opportunities to fa-
cilitate their access to digitalization
process. We steer our country’s digital
transformation journey by collaborat-
ing with local partners.
• SME opportunities in the Informa-
tion Technologies market: Leveraging
the positive perception of its 27 years
brand in the eyes of customers, and
its nationwide strong sales network,
Turkcell has a competitive advantage
in the medium-sized companies seg-
ment.
• Ability to offer end-to-end solutions
with a one-stop-shop approach by
integrating the Information Technolo-
gies and Telecom business: Turkcell’s
successful transformation from a tel-
ecom operator to an IT company in
recent years, together with its com-
petent human capital, strong tech-
nical know-how and collaborations
with suppliers help it stand out in the
market.
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Strong corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
Main competencies
Strong bond with customers
• The operator meeting the quality
service and communication needs of
the customers during the pandemic
period
• Superior digital customer experi-
ence via growing digital services
• Seamless service thanks to Turk-
cell’s strong infrastructure and wide
range of IT solution services
Strong infrastructure
• Sustaining the leading and differ-
entiating network quality in the sec-
tor and reinforcing the leading oper-
ator position in technology with the
launch of 5G
You can access detailed
information in the manufactured
capital section.
• Increasing efficiency by using the
technology neutral spectrum
• Delivering the latest and innovative
solutions via fixed and mobile tech-
nologies to the consumer, corporate
and residential segments
104
Techfin services
• Regulations becoming more sup-
portive of our techfin projects: The
regulatory environment in Turkey has
become more supportive for techfin
services with the two new types of
authorizations as part of Open Bank-
ing, namely, “Account Information Ser-
vice Provision” and “Payment Order
Start Service Provision,” as well as the
opportunity to offer Mobile POS.
• 30 million potential unbanked us-
ers in Turkey: Techfin and mobile tel-
ecommunications services provide
a convenient environment for many
people to access financial services
due to ease of use. Turkcell has the
potential to reach nearly 30 million
unbanked users in Turkey providing
opportunity to access financial ser-
vices, which is important for individ-
uals in terms of economic independ-
ence and social equality.
• Increase in demand for contactless
payment methods by individuals and
institutions after the pandemic: The
use of POS devices and cash, which
can cause contamination, declined
during the COVID-19 pandemic. The
pandemic period has enabled many
people to meet with digital/contact-
less payment systems and resulted in
increased use of such systems. The
anticipated increase in demand even
after the pandemic creates an op-
portunity for Turkcell.
• More accurate credit scoring with
the Credit Registration Bureau (KKB)
and telecom data: Turkcell knows its
customers better leveraging the cus-
tomer data it gathers through its tele-
com business. Thus, the most conven-
ient loan options can be offered to
customers in the financing business
based on KKB and telecom data.
• Financing the Turkcell ecosystem
and new customer potential: Finan-
cell, being one of our techfin services,
offers individual and corporate cus-
tomers convenient financing oppor-
tunities for their needs. We continue
tomer demand and needs. We aim to
be the pioneer of this transformation
with Turkcell Insurance, through inno-
vative solutions and digital processes
based on big data.
You can access detailed
information on our techfin
services in financial capital and
intellectual capital sections.
to add new customers as well as
expand our ecosystem and financing
volume via the financing services of
Financell.
• Growth potential
in corporate
segment with digital transformation
financing: Companies in our eco-
system can acquire software, server
equipment, smartphones and tab-
lets, which they need on their digital
transformation journey, at custom-
ized prices, advantageous interest
rates and with flexible payment plans
through the “Digital Transformation
Financing” offer we provide with our
Group company Financell. Thereby,
we support the digitalization journey
of companies.
• The digital channel share of less
than 1% in the insurance sector re-
flects a significant transformation op-
portunity considering changing cus-
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• Cyber security products and servic-
es that require Digital Operator com-
petence
You can access details on our
cyber security products and
services in the intellectual
capital section.
• Contribution to digital transforma-
tion with joint infrastructure
You can access details in the
manufactured capital section.
Advanced analytical
capabilities & technology
• Greater focus on and need for ana-
lytical capability with increased dig-
italization
• Recognizing the customer and early
detection of their needs by using big
data and analytical modeling
You can access details in the
intellectual capital section.
Strong & agile team
• Increasing importance of agile and
flexible teams in accordance with
the need “to master swiftly in difficult
tasks”, which stems from digitaliza-
tion
• Providing efficiency through the
transformation of company culture
with a flexible and agile approach
• Effective talent management
You can access details in the
human capital section.
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106
About Turkcell
Financial
capital
111
113
116
117
117
118
123
123
Revenues from operations
Business model hedging
Efficient capital allocation
Diversified financing
Strong and transparent financial management
Transparent investor communication - Investor Relations
Digital finance transformation
Techfin’s shining stars: Paycell and Financell
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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108
Financial capital
Financial capital
Inputs
Outputs
Value created
Revenues from operations
• Strong cash flow generation
Business model hedging
• Inflationary pricing
• Effective use of hedging instruments
• Strong collection performance
• Strong liquidity position
Effective capital allocation
• Asset light model
• Active portfolio management
Financing diversity
• Bank loans
• Debt market instruments
• Sustainable financing
Strong and transparent financial
management
• Transparent and accountable finance
management
• Transparent investor communication
TRY29.1
billion revenue
18.5%
operational
CAPEX / sales
ratio
USD132
million long
FX position
Outputs
TRY12.3
billion EBITDA
TRY6.3
billion EBIT
TRY3.4
billion free cash flow
Meetings with
506
investors
TRY4.2
billion net income
0.8x
consolidated
leverage ratio
EUR50
million sustainable / green
financing
Value created through
sustainable growth
• Real growth
• Investments
Strong balance sheet structure
• Liquidity performance
• Optimized debt maturity and cost of
funding
• Foreseeable net income performance
Market capitalization
Dividend paid and dividend yield
Value created for countries
of operation
• Contribution to GDP
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TURKCELL INTEGRATED ANNUAL REPORT 2020
110
Strong financial performance
As part of our solid
corporate governance
efforts, we disclose our
financial management
approach to our
stakeholders through
our integrated annual
reports and quarterly
and annual results
presentations, as well
as our website, and the
meetings we attend
and organizations we
hold.
We view our financial capital as the
key economic input of all activities
we carry out on our journey towards
creating stakeholder value. Ensuring
the continuity of our superior service
quality through our strong infrastruc-
ture, introducing our country and peo-
ple to the latest technologies, further
improving employment conditions, re-
alizing social responsibility projects of
true benefit and creating shareholder
value through dividends and increased
market capitalization requires robust
financial performance. In this respect,
strong and sustainable financial per-
formance is among Turkcell’s material
topics.
As part of our activities within the
scope of financial capital, we aim
for the revenues generated by our
operations to deliver strong opera-
tional profitability through disciplined
cost management practices. We also
take measures to effectively manage
our working capital and operational
capex, thereby supporting the strong
cash flow generation capability of our
operations.
Our business model hedging practice
is of great importance to us in terms
of the sustainability of financial per-
formance. In this regard, we price our
products and services factoring in
prevailing economic conditions in ac-
cordance with our inflationary pricing
policy, aiming to maintain real revenue
growth and eliminate the inflationary
impacts on our operational profitabili-
ty. Furthermore, through the active use
of hedging instruments, we also pro-
tect our financials against exchange
rate fluctuations, while securing our
cash flows. Maintaining strong liquid-
ity resources provides a resilient posi-
tioning against macroeconomic crises.
We ensure the efficient use of capital
through the balanced management
of our leverage level. Meanwhile, the
effective management of our working
capital with strong collection practic-
es supports our cash generation per-
formance.
In this context, our business mod-
el hedging practices and successful
budget management approach help
transform our successful operational
activities into strong financial results.
Efficient capital allocation is anoth-
er core topic in terms of our financial
capital. While carrying out activities
to allocate our capital resources to
more profitable areas that bring high-
er growth, we also aim to unlock the
potential value of our assets in our
balance sheet.
We closely monitor local and global
debt and capital markets for the fi-
nancing of our operations and invest-
ments, meeting our financing needs
through optimum funding methods by
utilizing diverse borrowing instruments
of appropriate currency, cost and ma-
turity structure. We effectively utilize
both traditional financing instruments
such as bank loans and open credit
lines, and capital market instruments
such as bonds, lease certificates and
Eurobond issuances in local and inter-
national markets. As part of our solid
corporate governance efforts, we dis-
close our financial management ap-
proach to our stakeholders through our
integrated annual reports and quar-
terly and annual results presentations,
as well as our website, and the meet-
ings we attend and organizations we
hold. In line with the goal of increasing
our Company’s market capitalization
through transparent communication,
we aim to develop and deepen the in-
vestor profile and increase the weight
and number of long-term institutional
investors.
You may review the details of
our audited annual financial
performance in the consolidated
financial statements section.
COVID-19 note
Due to measures taken during the
pandemic period, including cur-
few restrictions, the use of data on
mobile and fixed networks has in-
creased with greater time spent at
home and the rising use of remote
working and education platforms.
This has resulted in a significant
increase in the need for digitaliza-
tion. In this context, while rising de-
mand for our data and digital ser-
vices and solutions has positively
impacted our revenues, our inter-
national roaming revenues have
notably decreased due to travel
restrictions. Additionally, there were
a number of delays to our corpo-
rate projects.
With a focus on liquidity manage-
ment and collection risk in order to
maintain our strong financial per-
formance, we made dynamic rev-
enue projections and implement-
ed effective cost control actions.
Meanwhile, we prioritized revenue
generation in planning our capital
expenditures. During the pandem-
ic, we maintained communication
with our stakeholders with the
same level of focus. We transpar-
ently communicated our risks, ex-
pectations and assessments to our
stakeholders in the COVID-19-fo-
cused teleconference meeting we
organized at the beginning of April.
Subsequently, we shared updates
on the subject during our quarter-
ly announcements and meetings
with our investors.
As Turkcell Group, going forward
we plan to lead the digital trans-
formation process that has been
accelerated by
the COVID-19
pandemic, leveraging our strong
financial structure, innovative digi-
tal services and solutions, and our
customer-oriented business ap-
proach. Ensuring the sustainability
of this transformation and imple-
menting services that establish the
digital backbone of Turkey remain
key objectives of our financial ef-
forts.
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Revenues from operations
In generating revenues from ope-
rations, we ensure the continuity
of the innovative services we offer
our customers, improve the emp-
loyment conditions of our emp-
loyees, contribute to the national
economy through our investments,
and create value for our investors.
2020 was a year during which all
macroeconomic
developments
reflected the impact of COVID-19
pandemic, as the world’s econo-
mies shrank on related disruption
to the global supply chain and de-
mand.
Despite these
developments, which
affected Turkey and
other markets in
which we operate, we
sustained our strong
financial performance
in 2020 thanks to our
successful strategy
and strong business
model.
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Turkcell Group revenue
TRY million
15.8%
2020
growth
Despite the negative impact of travel
restrictions on international roaming
revenues, our revenues increased by
15.8% to TRY29.1 billion, driven mainly
by increased data and digital service
usage.
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17.7%
2020
growth
17.0%
2020
growth
Turkcell Group EBITDA
TRY million
Turkcell Group EBIT
TRY million
Financial capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
112
We sustained our
strong operational
profitability in 2020
with the contribution
of remote working
practices, the
decline in travel
expenses, the
increased share
of digital sales
channels, savings in
marketing expenses
and disciplined
cost management
practices.
We sustained our strong operational
profitability in 2020 with the contri-
bution of remote working practices,
the decline in travel expenses, the in-
creased share of digital sales channels,
savings in marketing expenses and dis-
ciplined cost management practices.
Accordingly, EBITDA increased by 17.7%
to TRY12.3 billion, while the EBITDA mar-
gin rose to 42.2%. Our EBIT margin was
21.6%. In a period, during which macro-
economic uncertainties prevailed due
to the pandemic, and while the Turkish
Lira depreciated 24% and 35% against
the US Dollar and Euro, respectively, we
registered strong net income on the
back of our robust operational perfor-
mance and prudent financial risk man-
agement practices. Accordingly, our
net income rose 30.5% on a yearly ba-
sis to TRY4.2 billion, marking the historic
high achieved by our company.
7
3
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4
,
6
4
2
3
,
9
1
0
2
0
2
0
2
30.5%
2020
growth
1
2
0
2
,
8
1
0
2
Turkcell Group net income
TRY million
Operating in the telecom sector brings
responsibilities such as having a strong
infrastructure capable of meeting ris-
ing capacity needs and regularly intro-
ducing customers to new technologies.
The revenues derived from our opera-
tions and our ability to generate strong
cash flows, along with our financing
resources, allow us to continue our in-
frastructure investments and introduce
our customers to the technologies of
tomorrow. Duly, our operational capital
expenditures (excluding license fees)
in 2020 amounted to 18.5% of our to-
tal revenues. During this period, while
making investments we followed a
disciplined approach supportive of our
goal of increasing customer satisfac-
tion, providing social benefit and sup-
porting our revenue generation.
Operational CAPEX
(excluding license fee)
/ sales ratio
Ratio
When our non-operational capital ex-
penditures are included, we have made
a total investment of TRY32 billion over
the past 5 years. We have contributed
to cost savings and the development
of domestic technologies by supplying
part of our network equipment from
domestic production.
0.5 pp
2020
growth
%
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2
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0
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1
.
9
1
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2
%
5
8
1
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0
2
0
2
Details of our domestic
network investments and 5G
activities can be found in the
manufactured capital section of
our report.
We have contributed
over TRY50 billion
to the Turkish
economy since our
establishment! The
revenues generated
from our operations
enable us to support
the economies of
those countries in
which we operate.
We will be able to finance the tele-
com equipment procurements to be
made over the next 3 years in Euros
and Renminbi (RMB) as part of the
EUR500 million, 8-year maturity loan
agreement signed with the China De-
velopment Bank (CDB) in 2020 for the
financing of our infrastructure invest-
ments. Having signed this long-term
loan agreement at favorable terms,
we have encouraged local currency
trade with foreign suppliers, strengt-
hening trust both in Turkcell and Tur-
key’s economy. Furthermore, we sig-
ned a loan agreement of US$90 mil-
lion in December 2020 with ING BANK
N.V. and AB Svensk Exportkredit within
the framework of the insurance of the
Swedish Export Credit Agency (EKN)
for the financing of products and ser-
vices procured from Ericsson AB and
Ericsson Telekomünikasyon A.Ş. The
loan agreement comprises three tran-
ches, each with a maturity of 10 years.
Regarding the revenues we generate
from operations, free cash flow ge-
Free cash flow
TRY billion
-0.1
2014
-2.5
2015
-2.2
2016
4.5G investment period
neration is among the issues that we
focus on the most. Our free cash flow
generation performance, which was
at a negative level between 2014 and
2018, particularly due to the frequency
and network investments made in re-
lation to 4.5G technology, turned po-
sitive in 2018 upon completion of tho-
se investments in large part, and was
followed by a rising trend of strong
operational performance. We sustai-
ned our solid financial performance in
2020, creating free cash flow of TRY3.4
billion. We intend to continue this per-
formance until the next technology
investment cycle, by maintaining suc-
cessful operational performance and
ensuring disciplined capital expenditu-
re and working capital management.
As Turkcell, we operate in 4 countries,
creating value through economic, so-
cial and technological development.
We also contribute to the digitaliza-
tion of other nations by exporting our
superior digital services, knowledge
and experience to 37 countries.
3.4
2.4
-0.7
0.0
2017
2018
2019
2020
We support the economy and GDP of
other countries, as our operations and
services result in increased economic
activity, creating job opportunities and
generating tax revenue.
SDG 8.1
Business model hedging
Business model hedging is one of our
key focus areas in sustaining strong
financial performance. In this con-
text, we price our products accord-
ing to prevailing economic conditions,
actively protect our balance sheet
against exchange rate fluctuations
using hedging instruments, and effec-
tively manage our liquidity resources.
During the pandemic period collection
performance management has also
been an issue of greater focus.
As Turkcell, we pay attention to the
right pricing of the value proposition
we offer to our customers. While im-
plementing pricing, it is vital to take
economic conditions into account for
the sustainability of our services. In
this respect, we focus on pricing our
products and services to reflect in-
flation. Our inflationary pricing prac-
tice contributes primarily to achiev-
ing sustainable real revenue growth,
while helping to eliminate inflationary
pressure on our costs, and thereby
protecting our operational profitabili-
ty. Moreover, as we determine our in-
vestment budget based on generated
revenues, we also protect our capital
expenditures against exchange rate
fluctuations, reflecting the impact of
such fluctuations to our revenues in
the long run through inflationary pric-
ing. Leveraging our analytical compe-
tencies and using big data effectively,
we price our products and services by
understanding the needs of our cus-
tomers, and reflecting inflation trends.
Accordingly, we offer the right price to
the right customer at the right time.
We support our robust operational
and financial performance with strong
ARPU generation backed by inflation-
ary pricing practice. Meanwhile, our
growing postpaid subscriber base, ris-
ing data usage and our upsell strate-
gy also support ARPU generation. We
expect our ARPU performance to trend
with the inflation path in the long term.
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114
As at the end of
2020, we have a net
FX long position of
USD132 million. Going
forward, we aim to
maintain our foreign
exchange position
at a neutral-positive
level in order to
minimize the impact
of exchange rate
movements on our
financials.
Turkcell ARPU vs. CPI Trend
Q118=100
Company and TUIK announcements
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149
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134
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4
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Tcell ARPU (exl. M2M)
CPI
100
100
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Q
105
104
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1
2
Q
We follow a prudent risk management
approach within the framework of our
business model hedging practice. In
this respect, we hold the bulk of our
cash in hard currencies as a natural
hedging mechanism. As of the end
of 2020, excluding FX swap transac-
tions, 74% of our cash is in USD, 4% is
in EUR and 22% is in TRY. In addition,
we actively use hedging tools within
the scope of our prudent risk manage-
ment approach. Utilizing these tools,
we convert our floating rate foreign
currency denominated debt into fixed
rate Turkish Lira debt. While 78% of our
total debt before hedging transactions
is in foreign currency as at the end of
2020, the ratio declines to 43% when
the effects of hedging instruments are
included. In order to reduce our risk
by diversifying our foreign exchange
transactions and position, we also
prioritize local currency trade when
making payments to our suppliers. This
year, we signed Turkish Lira denomi-
nated payment agreements with our
largest suppliers to protect our foreign
exchange denominated assets. Thanks
to our successful hedging practices,
we were able to turn our foreign ex-
change position, which was negative
in 2018, to positive in 2019. As at the
end of 2020, we have a net FX long
position of USD132 million. Going for-
ward, we aim to maintain our foreign
exchange position at a neutral-positive
level in order to minimize the impact
of exchange rate movements on our
financials.
Net FX position
USD million
5
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3
1
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2
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8
1
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4
2
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As a telecom
company that
operates in emerging
markets, we must
always be prepared
for ups and downs
in financial markets,
and sustain a strong
liquidity position
accordingly to ensure
operational continuity.
Hedging tools also protect us against
interest rate risk in the market. Accord-
ingly, approximately 39% of our total
debt has a floating interest rate as at
the end of 2020, while our fixed rate
borrowing share is at approximately
94% including the effects of hedging
instruments. Also vital to the risk man-
agement approach is the fact that the
hedging tools that we use cover both
principal and interest payments of the
respective debt service to maturity. In
this respect, the terms of our hedg-
ing agreements are protected against
fluctuations
in market conditions.
Moreover, we work with well-known,
reputable and reliable counter parties
when entering into these agreements.
As a telecom company that operates
in emerging markets, we must always
be prepared for ups and downs in fi-
nancial markets, and sustain a strong
liquidity position accordingly to ensure
operational continuity. Liquidity man-
agement is therefore a crucial area
for our financial capital. In this respect,
we hold TRY11.9 billion in cash, mostly in
foreign currency on our balance sheet
as at the end of 2020. This amount is
sufficient to cover our entire debt ser-
vice until the end of 2024.
Liquidity management*
Principal & interest payments (USD million)
1,517
1,517
552
275
277
2021
325
325
325
66
259
255
255
2022
2023
2024
2025+
FX
Local Currency
In addition to our strong cash position,
our committed credit lines of USD727
million, as well as our strong free cash
flow generation performance support
our liquidity position.
Another crucial focus area concern-
ing liquidity is debt management. De-
spite the significant depreciation of
the Turkish Lira against the US Dollar
and Euro in 2020, we managed to low-
er our leverage level (net debt/EBIT-
DA) to 0.8x, thanks to our strong cash
generation performance. Until the next
technology investment cycle, our goal
will be to lower our leverage level with
strong cash flow generation, and to
prepare for future investments.
x
4
.
1
8
1
0
2
x
0
.
1
9
1
0
2
x
8
0
.
0
2
0
2
Consolidated leverage ratio
* Data of Turkcell Group companies excluding Turkcell Financing Company.
Includes principal and interest payments.
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116
We also sustained
a robust collection
performance with
respect to our
financing business in
2020 in the pandemic
environment, keeping
our cost of risk below
sector averages.
Additionally, the synchronized mone-
tary and fiscal expansion of govern-
ments and central banks to mitigate
the devastating effects of COVID-19
have caused the declining interest
rates to fall to historic low levels. In this
respect, we prepaid the USD1 billion
syndicated loan, which we had utilized
to finance infrastructure investments
and potential investment opportunities
as part of the agreement signed with
BNP Paribas, Citibank, HSBC, ING and
Intesa Sanpaolo banks in 2015, there-
by optimizing our financing costs. Fur-
thermore, we extended our debt ma-
turity with the long-term loans utilized
throughout the year.
Collection performance has been an
area of increased focus, particularly
during the pandemic period. While we
took timely actions for collections, our
customers were also sensitive to bill
payments given that telecom services
are an integral part of their lives. These
two factors enabled us to maintain our
strong collection performance in 2020.
We also sustained a robust collection
performance with respect to our fi-
nancing business in 2020 in the pan-
demic environment, keeping our cost
of risk below sector averages. We
follow a prudent approach to granting
loans to customers. We take several
metrics including the payment perfor-
mance of our customers with respect
to their telecom bills, as well as cred-
it bureau scores into consideration as
part of our evaluation process. This ap-
proach forms the basis of our strong
collection performance.
%
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Financell cost of risk
Ratio
Efficient capital allocation
The biggest challenges facing the tel-
ecom industry on a global scale are
high capex requirements and slow
revenue growth due to competition.
For this reason, many telecom com-
panies around the world are lower-
ing their resource allocation in the
traditional telecom business through
public offerings, M&A transactions,
infrastructure sharing, and sell and
in-
leaseback
vesting into higher growth areas. As
Turkcell, we also invest in areas of
low investment requirement such as
digital services, techfin services, and
information technologies, focusing on
digital efficiency, and adopting the
transactions, while
“Asset-Light” approach to support
our economic growth. Going forward,
our goal will be to achieve balanced
revenue growth through traditional
telecom businesses and new invest-
ment areas. Moreover, we are plan-
ning to also finance our investments
in new businesses with free cash flow
generation and active portfolio man-
agement activities, along with debt
financing. As part of active portfolio
management, we aim to unlock the
value of the assets in our balance
sheet by carrying out capital market
or private transactions when suitable
market conditions and investor appe-
tite exist.
SDG 8.2
UNGC CFO Taskforce
We are among the founding
members of the UN Global
Compact CFO Task Force ini-
tiative, which aims to develop
sustainable corporate finance
models and tools in line with
United Nations Sustainable
Development Goals. This initi-
ative aims to ensure that the
concept of sustainable finance
becomes an essential factor
in the policy-making process-
es of institutions via financial
leaders of the global business
world, to achieve sustainable
development goals and to cre-
ate a large, liquid and effective
market for investments that
serve these goals.
The initiative, in which Turk-
cell Chief Financial Officer
Osman Yılmaz participated,
determined the critical task
areas in accordance with the
SDGs as being ‘Impact thesis
and Measurement’, ‘Integrat-
ed Strategy and Investments’,
‘Integrated Corporate Finance’
and ‘Integrated Communica-
tions and reporting’.
42 global companies from 19
sectors with a total market
capitalization of over USD1
trillion participate in the CFO
Task Force. In addition to con-
tributing to the SDGs within
the scope of this project, the
project also develops common
policies to realize the goals set
for the UN 2030 agenda.
SDG 17.16
As Turkcell, we carry out ac-
tivities to increase the partic-
ipation of Turkish institutions
and organizations in the CFO
Taskforce in cooperation with
UN Global Compact Network
Turkey.
We transferred our 41.5% stake in Fin-
tur Holdings B.V. to Sonera Holding
B.V. in 2019 as part of our efficient
capital allocation focus. The cash in-
flow that resulted from this transac-
tion helped us improve our leverage
ratio and liquidity, and strengthen our
foreign exchange position.
Moreover, as part of the support we
provide to infrastructure sharing pro-
jects, we share fixed infrastructure
with Türksat and Vodafone, which
enables us to reach more households
with our services and achieve effi-
ciencies. Going forward, the poten-
tial for passive infrastructure sharing,
particularly for fiber, will continue to
be evaluated. In parallel to global
trends, we believe that infrastructure
sharing has the potential to create
operational savings as well as sup-
port the national economy via the
efficient use of resources.
Diversified financing
By leveraging our established market
relations, we aim to utilize alterna-
tive funding methods and resources
in pursuit of financing diversity, be-
side our strong equity position. We
utilize loans obtained from domestic
and foreign banks, issue Eurobonds
in international markets, bonds, bills,
lease certificates and Asset Backed
Securities in local markets, and obtain
ECA loans for financing procurements
from foreign suppliers. We also use
sustainable financing (sustainability
indexed loan, green loan) as part of
diversified funding resources.
SDG 8.4
We play a leading role in Turkey in
terms of accessing sustainable fi-
nancing sources. In 2019, utilizing a
“Sustainability Linked Loan” of EUR50
million with 3-year maturity from BNP
Paribas, we further strengthened our
leading position in funding activi-
ties through sustainable financing.
In 2020, we entered into a 5-year
maturity, EUR50 million “Green Loan
Agreement” with ING to finance our
environmentally-friendly investments
in renewable energy, energy efficien-
cy, green digital services and green
buildings, strengthening our position
in this field.
Loans utilized under Sustainable
/ Green financing loans
EUR million
0
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1
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2
Strong and transparent
financial management
It is also of importance for our cor-
porate structure that we have a
transparent and accountable finan-
cial management, as well as a robust
one. We plan, manage and analyze
our budget effectively within the
scope of this transparent and strong
financial management approach.
In our countries of operation, we
manage our tax practices transpar-
ently and accountably, directly and
indirectly, and disclose them via our
annual reports, material disclosures,
and quarterly and annual results re-
leases. Across the company, we share
information in many different formats,
including share performance report-
ing, senior management reports and
benchmarking analysis.
In
line with being an exemplary
corporate citizen, we carry out an-
ti-bribery and anti-corruption activ-
ities with zero-tolerance, and act in
accordance with legislation to main-
tain an effective competitive market
environment. We conduct all our fi-
nancial transactions in accordance
with CMB and SEC regulations.
117
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118
We explain our
approach to
communication with
our investors and
other stakeholders
in our social values
and relationships
section, and our
communication
channels in the
stakeholder
communication
channels table.
Celebrating
our 20th
anniversary
at the New York
Stock
Exchange!
2020. By the end of 2020, Turkcell’s
American Depositary Shares num-
bered 63.3 million.
On October 15, 2015, Turkcell issued
bonds with a nominal value of USD500
million and a maturity of 10 years. On
April 11, 2018, we issued bonds, which
are also traded on the Irish Stock Ex-
change (Euronext Dublin), with a nom-
inal value of USD500 million, a ma-
turity of 10 years and a coupon rate
of 5.80%. In addition, our subsidiary
Superonline carried out three sukuk
issuances for a total of TRY325 million
on February 4, June 23 and Novem-
ber 18 of 2020. Our subsidiary Turkcell
Finansman received on November 12
CMB approval for a bond issuance
with a limit of TRY500 million, but has
made no issuances in 2020.
The share of foreigners in Turkcell’s
free float was 79.4% in 2020. In the
same period, the share of foreigners
in Borsa Istanbul was 49%.
We regularly report annually on the
performance of Turkcell shares at the
BIST and NYSE, and also report on
five-year trends.
You may access the details of
our principles and reporting
on anti-bribery and corruption,
competition management
and related issues in the
strong corporate governance
section, and the data on taxes
in the consolidated financial
statements section.
Transparent investor communication
- Investor Relations
We conduct our investor relations
activities in accordance with Corpo-
rate Governance Principles, having
adopted an approach that ensures
accessibility, and that provides rapid
feedback to stakeholders, and deliv-
ers transparent, consistent and timely
information. As part of our transpar-
ent and active communication, we
give access to documents such as
audit reports, press releases and in-
vestor presentations, which include
quarterly financial and operational
performance on a quarterly basis, on
our website.
We have begun to issue a consoli-
dated integrated annual report, and
to disclose related information pre-
viously filed separately in our annual
reports and sustainability reports.
Capital market instruments
performance
Turkcell shares commenced trading
simultaneously on the Borsa Istanbul
(BIST) and the New York Stock Ex-
change (NYSE) on July 11, 2000. The
shares are traded under the TCELL
ticker at the BIST and as American
Depositary Shares (ADS) on the NYSE
under the ticker TKC.*
Turkcell’s issued capital has a nom-
inal value of TRY2.2 billion.** Turkcell,
the only Turkish company listed both
on Borsa Istanbul and the New York
Stock Exchange, became the 9th most
valuable company among those trad-
ed on the BIST with a market value
of TRY35.4 billion as of December 31,
* Two ADRs represent five shares.
** It includes 2,200 million shares, each with a nominal value of 1 TL.
The Turkcell Investor
Relations team
consists of members
with a deep
understanding both
of the company
itself and of sector
dynamics, and who
can convey the
strategy and focus
areas of the company
comprehensively.
Share and bond buyback
The Turkcell Board of Directors au-
thorized the Company management
to buy back Company shares and
bonds with a maximum fund amount
of TRY450 million in an attempt to
protect our investors against any per-
ception of instability that may arise
in the short and medium term; sub-
sequent to the events on, and after
July 15, 2016, and/or due to the po-
tentially negative reflection of global
macroeconomic volatility on Turkey in
accordance with the announcements
of the Capital Markets Board dated
July 21, 2016 and July 25, 2016. In this
context, since 2016, 16.9 million shares
(equivalent to TRY180.2 million) and
bonds totaling USD20.5 million nom-
inal amount (equivalent to TRY103.5
million) have been purchased. All of
the bonds had been sold back as at
the end of 2020.
Our business principles
We adopt Corporate Governance
Principles. The basic business prin-
ciples adopted by the Turkcell In-
vestor Relations Department include
accessibility, the provision of rapid
feedback to stakeholders, and their
informing transparently, consistently
and on a timely basis. Information
flow is provided to all stakeholders
through the Public Disclosure Plat-
form, Turkcell Investor Relations web-
site and social media platforms.
The Turkcell Investor Relations team
consists of members with a deep
understanding both of the company
itself and of sector dynamics, and
who can convey the strategy and fo-
cus areas of the company compre-
hensively. The team is differentiated
in the sector by its dynamic structure
and effective communication. Turkcell
Investor Relations works to establish
long lasting relationships with inves-
tors. Questions from investors and
analysts are answered in the fastest
and most transparent manner within
the framework of relevant legislation.
In this context, as the Investor Rela-
tions Department, throughout 2020:
• We held a total of 506 meetings
with institutional investment funds,
most being virtual.
• We attended 19 investor conferenc-
es, of which 15 were virtual.
• We shared our financial results four
times during the year via teleconfer-
ences.
• We shared the initial impact of the
COVID-19 pandemic on our business
with our investors.
• Over a thousand information re-
quests were received throughout the
year via phone and e-mail, to all of
which we responded.
The limitations on travel arising from
the pandemic have obliged us to hold
our meetings with analysts, investors
and credit rating agencies virtually.
In this respect, we have reduced our
travel related carbon footprint.
The top 10 topics most frequently
asked to Investor Relations in 2020
were:
The effects of the pandemic
on our activities,
The impact of
macroeconomic conditions
on business model and
financials,
Shareholder change, and its
possible effects on strategy,
The competitive environment,
our pricing policy and
the trend of operational
indicators,
5G license tender roadmap
and related capital
expenditures,
Details on hedging
instruments,
Strategic focus areas,
priorities and goals,
Strategy and expectations in
international operations,
Details regarding operational
investments,
Liquidity and debt structure.
119
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Financial capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
120
Our company’s
ESG rating was
determined as
A by Morgan
Stanley Capital
International (MSCI)
in January 2021.
Turkcell is the only
telecommunications
company in Turkey to
have this rating.
We strive to provide the maximum
benefit and create value for Turkcell
and our stakeholders
The primary goal of Turkcell Inves-
tor Relations is to increase the mar-
ket capitalization of our company
and the trading volume of Turkcell’s
shares. Within this scope, our target is
to develop and deepen Turkcell’s in-
vestor profile and increase the weight
and number of long-term investors in
the institutional investor base.
Our communication makes a differ-
ence
Turkcell believes in simultaneous and
open communication with its stake-
holders. As Turkcell Investor Rela-
tions, we actively use communication
channels such as the website and the
Public Disclosure Platform to provide
comprehensive, accurate and timely
information to our investors around
the world.
We conveyed our risks, expectations
and evaluations regarding the pan-
demic to our stakeholders by organ-
izing a teleconference meeting on
April 10, 2020, when uncertainty was
at its peak. This meeting was an ex-
emplary action in terms of transpar-
ent and fair corporate governance
practice, and was appreciated by
our stakeholders for its timing and
content.
indices and perfor-
Sustainability
mance indicators
Our successful activities in the sus-
tainability area are confirmed by
our achievements in local and glob-
al indices. We have been included in
the BIST Sustainability Index (BIST SI)
since its launch in 2014. By revealing
companies’ approach to sustaina-
bility issues such as global warming,
depletion of natural resources includ-
ing water, health and safety, and em-
ployment, this index provides an in-
dependent assessment and registra-
tion of companies by Borsa Istanbul.
Our company’s ESG rating was de-
termined as A by Morgan Stanley
Capital International (MSCI) in Janu-
ary 2021. Turkcell is the only telecom-
munications company in Turkey to
have this rating.
Moreover, Turkcell is the only Turkish
telecommunications company to be
included in the FTSE4Good Emerg-
ing Markets Index which measures
the ESG performance, calculated by
FTSE, an independent organization in
partnership with the London Stock
Exchange and Financial Times.
Share information and dividend yield
As the investor relations team, we
aim to increase the market capital-
ization of Turkcell to its fair value. In
this respect, we evaluate the possi-
bilities of creating strategic value in
accordance with our policies. We
also aim for dividend distribution to
our shareholders in accordance with
our dividend policy, and within the
framework of fiscal discipline.
D i v i d e n d y i e l d
2018
7.2%
2019
3.6%
2020
2.3%*
* In 2020, dividend pay-out ratio to our shareholders was 25%, which was the highest rate permitted by legislation.
27 brokerage
houses, half of
which are foreign
companies, actively
monitor and analyze
Turkcell shares.
As of the end of
2020, there are
21 analysts giving
“buy”, 6 analysts
giving “hold” and no
analysts giving “sell”
recommendation.
TCELL (TL)*
Lowest
Highest
Closing
TKC (USD)*
Lowest
Highest
Closing
2015
7.80
10.67
7.80
2015
6.61
11.32
6.69
2016
7.00
9.80
7.68
2017
7.38
13.53
13.53
2018
9.19
14.73
11.46
2019
10.55
14.23
13.48
2020
11.78
16.83
16.10
2016
2017
2018
2019
2020
5.02
8.52
5.44
5.26
8.93
8.93
3.58
9.74
5.30
4.37
6.63
5.67
4.29
6.13
5.39
*Share prices are adjusted for dividend payments.
Source: Bloomberg
Stock exchange symbols
Country
Share
ADR
Bond
Bond
Stock exchange
Borsa İstanbul
NYSE
Irish Stock Exchange
Irish Stock Exchange
Ticker symbol
TCELL
TKC
ISIN: XS1298711729
ISIN: XS1803215869
Analyst recommendations
Share performance (Relative) (2020)
78% 22%
BUY
HOLD
1.3
1.2
1.1
1.0
0.9
0.8
0.7
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Financial capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
122
Financial capital
TURKCELL
S&P
Fitch
Fitch National
Long-term
credit rating
BB-
BB-
AAA (tur)
Outlook
Date
Stable
Stable
Stable
April 2019
March 2021
March 2021
SUPERONLINE
Long-term
credit rating
JCR-ER
JCR-ER National
BBB-
AA (Trk)
Outlook
Date
Negative
Stable
May 2020
May 2020
Credit ratings
Turkcell,
Superonline
and Turkcell
Finansman*
receive ratings
from the world’s
leading credit
rating agencies.
TURKCELL
Finansman
Long-term
credit rating
Fitch
Fitch National
B+
AA- (tur)
Outlook
Date
Stable
Stable
April 2020
April 2020
International credit rating agency Fit-
ch Ratings upgraded our Company’s
national long-term credit rating from
“AA+ (tur)” to “AAA (tur)” and kept its
outlook as “Stable”. Our company’s
issuer
long-term foreign currency
default rating was affirmed as “BB-”
and its outlook as “Stable”.
Investor Relations Contact Information
Tel: +90 (212) 313 18 88 Fax: +90 (216) 504 40 58
E-mail: investor.relations@turkcell.com.tr
https://www.turkcell.com.tr/en/aboutus/investor-relations
Turkcell Küçükyalı Plaza, Aydınevler Mahallesi İnönü Caddesi
No: 20 B Blok Küçükyalı Ofispark, 34854 - Maltepe / İSTANBUL
* Turkcell Finansman’s Fitch rating expired on April 27, 2020 due to commercial reasons.
Carrying out
activities that
consider the needs
of our customers, we
successfully ended
2020 having posted
record transaction
volumes across
various products.
Paycell increased
its revenues by 13%
this year, while its
EBITDA margin was
52%. Paycell’s non-
group revenues rose
by 62% during the
same period.
Digital finance transformation
Increasing the digital maturity of the
finance function is among our top
priorities. We digitize the operating
model of the finance function in or-
der to provide an environment where
business processes are organized
over systems, manual interventions
are minimized, and internal control
points are automatically supported.
As part of this transformation, we aim
to improve operational efficiency as
well as establish a working environ-
ment comparable to best practices.
In this context, our current financial
maturity level was assessed, pro-
gress areas were determined, and
roadmaps were established in detail.
Upon completion of the transforma-
tion, which considers every compo-
nent of the operating model ranging
from process to technology, and from
organization to data, 68% of the fi-
nance function’s processes are to be
digitized and a 20% operational effi-
ciency increase is expected.
Techfin’s shining stars:
Paycell ve Financell
In 2020, we continued to improve
the products and services we offer
to our customers under Paycell. Pay-
cell, which serves over 12 thousand
contracted merchants, expanded
its solution portfolio for commercial
businesses with the Android POS this
year. Paycell Android POS, the first
Android POS device to comply with
relevant legislation, and approved by
the Turkish Revenue Administration
(GİB), provides cost and efficiency
advantages to member merchants,
while offering collection, stock track-
ing and e-invoice processes on a
single platform. The Paycell Single
Account project conducted in 2020,
enabled users to view and easily
manage their Paycell Card balance
and mobile payment limits in a single
account. Also in 2020, we took an im-
portant step by enabling 24/7 money
transfer service to an IBAN number
with contracted banks. Moreover,
we offered a completely contact-
less payment experience by improv-
ing the payment process at physical
points in the pandemic period, during
which contactless payments became
more popular as customers sought
new payment methods. Having en-
tered
into new agreements with
numerous restaurants, markets and
coffee chains, we ensured that cus-
tomers could make their purchases
contactless with QR codes.
SDG 8.3
Paycell enables customers to make
purchases at member merchants
without the need of a bank card or
payment at the door, offering the op-
portunity to reflect the fee to telco
bills. Paycell also provides the oppor-
tunity of paying corporate bills both
using the application and at Turkcell
stores. With the rising number of con-
tracted merchants each year, Paycell
customers can shop quickly and se-
curely using QR codes. Meanwhile,
Paycell Card offers the opportunity
of using a card to those under the
age of 18, and therefore unable to be
a bank customer. At the same time,
Paycell Card customers can manage
their balance and mobile payment
limits through a single account.
Paycell registered a first this year by
adding a brand new easy payment
alternative. Thanks to the “Ready to
use limit” feature, users can spend
their mobile payment limits via their
Paycell Cards at any time, and repay
through their Turkcell bill at the end of
the month. Moreover, they can con-
vert part of this personalized limit into
funds and withdraw them in cash.
Carrying out activities that consider
the needs of our customers, we suc-
cessfully ended 2020 having posted
record transaction volumes across
various products. Paycell increased
its revenues by 13% this year, while
its EBITDA margin was 52%. Payce-
ll’s non-group revenues rose by 62%
during the same period. The number
of Paycell 3 month-active users have
become 4.7 million, and the number
of Paycell registered credit cards
reached 7.9 million with an increase
of 88%.
123
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TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
124
Financial capital
Paycell 3-month active
users (million)
Paycell total transaction
volume (TRY billion)
Revenue (TRY million)
EBITDA (TRY million)
EBITDA margin (%)
2018
4.8
7.8
187
136
73%
2019
4.5
9.4
252
160
64%
2020
4.7
9.0
285
147
52%
Financell, one of the key players in
Turkey’s financing sector, allows us to
offer financing solutions to individu-
al and corporate customers for their
technological product and service
purchases. In 2020, we also became
active in the field of corporate loans
via our digital transformation loan.
Meanwhile, credit risk infrastructure
and digital transformation projects
implemented in 2020 enabled us to
conduct credit assessments at a fast-
er pace and manage credit risk ef-
fectively. With the completion of pro-
jects in 2020, we started to provide
financing offers to our Corporate
segment and Superonline customers.
Accordingly, we became capable of
providing financing solutions for all
products and services that we sell
as Turkcell. Turkcell Sigorta Aracılık
Hizmetleri A.Ş., which completed its
infrastructure development activities
in the last quarter of 2019, continued
to offer innovative risk management
solutions to its customers via fast and
easy-to-access products.
2018
2019
2020
Number of customer acquisitions for Turkcell
through Financell (thousand)
Financell asset size (TRY billion)
Number of credits granted by Financell (million)
Number of customers who used credits annually
(million people)
Total customer loan portfolio (TRY billion)
Revenue (TRY million)
EBITDA (TRY million)
EBITDA margin (%)
Net income (TRY million)
102
5.2
2.4
1.9
4.2
942
426
45%
254
113
3.0
1.9
1.4
2.4
899
504
56%
187
129
2.5
2.0
1.4
1.9
567
367
65%
241
The interaction of our
financial capital with
our other assets
Our financial capital
plays a key role in
providing the necessary
financing for the
realization of all activities
conducted under other
capitals, while itself
being supported by
revenues generated
from other capitals.
Revenues generated by
our services support our
market capitalization
and dividend yield,
while the quality of
our products and
services are enhanced
by the financing of
R&D studies, thereby
increasing customer
satisfaction. Meanwhile,
our social responsibility
projects and transparent
communication with our
investors contribute to
our social values and
relationships. Furthermore,
through our sustainable
financing activities we
reduce our negative
impact on our natural
capital.
(cid:41)(cid:36)T(cid:56)(cid:53)(cid:36)
******************************************
******************************************
Tarih
(cid:250)(cid:252)(cid:79)e(cid:87)(cid:80)e (cid:36)dı:
(cid:250)(cid:252)(cid:79)e(cid:87)(cid:80)e Kodu:
Dosya No:
Sıra No:
Tarife Kodu:
1 2 / 0 7 / 2 0 2 0
(cid:250) s (cid:87) a (cid:81) (cid:69) u (cid:79)
2 1 2 . 3 0 . 0 9 3 . 0 0
512,23
292,22
872,29
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PAYCELL HAZIR LİMİT’İNDEN
PAYCELL KART’INA AKTAR
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DİLEDİĞİN YERDE
KULLAN
T
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GERİ ÖDEMESİNİ
FATURANA YANSIT
R
E
L
A
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S
A
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TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
126
Strong corporate governance
Human
capital
130
Human capital management
131
Our decent business practices
132
Our productive Turkcell family
144
Making a difference in employment
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
127
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128
Human capital
Human capital
Inputs
Outputs
Value created
Diversity, inclusion and equal opportunity
• VoE and VoD meetings
• Woman Developers of the Future Project
Our competent employees and career development
• Backup management
• YUPO
• Turkcell Academy trainings
• Digital Master’s Program
• Technology Retailing Certificate Program
Safe and healthy work environment
• Field OHS improvement studies
• RADAR Program
Agile teams/employees
Employee practices that create difference
• Young Talents
• Young Talent
• Stajcell
• Flex HR applications
• The Stars Coming Back project
• Equal Conditions, Equal Chances at Turkcell!
• The “Tell your Candidate, Create Benefit” application
Number
of new hires
female
262
461
male
Outputs
150employment
through Young
Talent Program
98.7%
RADAR Turkcell
Group performance
score
33%women employee
ratio
1.4million total hours
of training
Employee
turnover rate
200
internship through
Stajcell
0.89
occupational accident
frequency
Contribution to employment
• Employment created in the countries / geographies
where we operate
Having competent human resources, ready for the
digital world of the future
• Developing the competencies of employees
Developing the competencies of women to increase
their employment in technology field
Creating a strong and agile employee culture
Being a good employer
• Having physically and mentally healthy employees
• Diversity, inclusiveness and equal opportunity in
Human Resources practices
• Loss of working hours due to occupational accidents
for female
2%
6%
for male
employees
39,560
ReFlex number
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Human capital
Human capital management
Throughout our journey of activities
that serve our people with prod-
ucts and services that reflect Turkcell
quality, it is our priority to imbue our
employees with a sense of pride in
being part of the Turkcell family. We
comply with legal requirements as
part of our human resource process-
es in accordance with relevant laws
and regulations. We communicate
all operational changes that could
significantly impact our employees
within the legal notice period via
our internal communication channels.
We consider it among our core eth-
ical values to oppose discrimination
based on gender, age, belief, ethnic-
ity, nationality, marital status, health
status, and physical capacity in all of
Turkcell’s business activities. Respect
for human rights lies at core of our hu-
man resources activities. Accordingly,
we implement human resources prac-
tices that ensure equal opportunities
for all individuals, and support inclu-
sion and diversity. As the large Turkcell
Group family of 24,675 employees, we
adapt to the requirements of the rap-
idly evolving digital age with agility
to better respond to customer needs.
And we continuously develop our skills
with training programs that offer rich
content.
Under the leadership of the Turkcell
HR Center of Excellence team, we
carry out activities regarding the de-
sign of all our human resources pro-
cesses, changes and improvements
to our procedures, as well as wage
policies and the performance and
development management of our
employees. With the cooperation of
Turkcell teams and our Organization-
al Development directorate, we carry
out exemplary activities in determin-
ing the goals and risks of our business
processes, defining roles and respon-
sibilities and digitizing of our human
resources management.
We consider
Turkcell employees
as members of a
large productive
family, who carry out
activities with the
aim of creating social
value by leveraging
skills in their area of
expertise, and as the
key asset of Turkcell.
During Turkcell’s
digital transformation
journey, we continue
to receive the
greatest support from
our employees thanks
to Turkcell’s strong
communication and
interaction culture.
We aim to ensure
an employment
experience that
makes our employees
feel more valuable
and productive,
and hence happier.
This approach is an
integral part of our
corporate culture.
COVID-19 note:
In 2020, employment and work-
ing conditions were reshaped by
the COVID-19 pandemic. Yet, we
continued our recruitment activ-
ities to meet increasing custom-
er demand, as well as achieve
our digitalization goals. While
carrying out activities, we also
supported the national econo-
my via our successful employ-
ment practices. Having already
independent
conducted office
working practices such as “mo-
bile working” and “office station”
for over 3 years, we were able to
rapidly adapt to different remote
working models such as mobile
working and home office when
COVID-19 entered the picture.
We provided our field employ-
ees with the necessary hygien-
ic materials. Moreover, we took
necessary actions to ensure our
employees’ physical and psycho-
logical safety. To enable them to
spend more quality time while
working remotely, increase so-
cialization and enhance team
motivation, we organized remote
training courses, online company
activities, and various programs
aimed at healthy living. In this
period, we also received instant
feedback from our employees,
and developed our processes
and principles in light of the in-
formation gathered. As part of
the ‘COVID-19 Virtual Working
Assessment Survey’ conducted
by Kincentric and scored by our
employees, we achieved robust
results on each of the following
main topics: ‘Anxiety and Con-
nectivity’,
‘Senior Management
Approach, Communication’, ‘Em-
ployee Health, Well-being, Oc-
cupational Safety’, and ‘Virtual
Work Efficiency’. The survey re-
sults confirmed Turkcell as being
among the top-ranked compa-
nies in Turkey in terms of positive
perception. We also scored high-
er results in comparison to global
companies across all metrics.
Our decent business practices
We carry out all of our human re-
sources activities with a focus on val-
ue creation with the responsibility of
being an exemplary corporate citizen
both in our country and globally. We
hear the expectations of the strong
and agile Turkcell family with regards
to business management, and take
swift actions to increase employee
loyalty and satisfaction. We aim to
make sure that Turkcell is the most
preferred workplace in the eyes of
our employees through the combina-
tion of our decent business practices
and “Digital HR” vision.
Diversity, inclusion and equal opportunity
Respect for human rights is at the
core of our human resources activi-
ties. In this regard, our human resourc-
es practices extend equal opportuni-
ties to all individuals, supporting inclu-
sion and diversity. Turkcell carries out
its activities to prevent discrimination,
inequality, human rights violations,
forced labor and child labor within
the scope of its Human Rights Poli-
cy and continues its efforts to adopt
these values across its supply chain.
All related activities and practices
confirm our commitment to our equal
opportunity, inclusion and diversity
principles. In 2020, there were no cas-
es of discrimination brought against
Turkcell İletişim Hizmetleri A.Ş. by our
employees or third parties, and no
lawsuits were filed against Turkcell for
discrimination.
We state our commitment to compli-
ance with the principles set forth in
our Human Rights Policy announced
at the beginning of 2021 as part of
our relations with our employees,
customers, business partners and all
our stakeholders. Thereby, we aim to
ensure compliance to requirements of
national legislation and international
capital markets regulations that we
are subject to, regarding employment
conditions.
We respect the rights of our employ-
ees arising from employee-employ-
er relations, and protect these rights
with our human resource practices.
With our equal pay for equal work
policy, there is no basic salary differ-
ence between our female and male
employees. In order to prevent the
incidence of child labor and debt
bondage, we adopt the ILO (Interna-
tional Labor Organization) standards
across our entire value chain, particu-
larly for our suppliers.
SDG 10.4
You can find detailed information
on our equal opportunity,
inclusion and diversity practices
for our supply chain in the value-
oriented responsible supply
chain management section of
our report.
Most of our operations are performed
by Turkcell employees. With new col-
leagues, who join us from all over Tur-
key, we constantly expand our family
and increase the active workforce.
Meanwhile, we believe that profes-
sions and fields of expertise go be-
yond gender classifications. As a
leading digital operator company, we
support women and their activities in
STEM (Science, Technology, Engineer-
ing, Mathematics) areas. Accordingly,
we carry out numerous activities that
support the employment of women
engineers, particularly through the
Women Developers of the Future pro-
gram.
SDG 5B
You can find detailed
information about the Women
Developers of the Future
Program in the social values
and relationships section of our
report.
131
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132
Our subsidiary Global
Bilgi, which operates
at 25 locations, 19
being in Turkey, and
6 in Ukraine as at
the end of 2020,
contributed to the
development of both
local economies and
the human resources
development at these
locations through
the employment it
creates. Providing
employment to
approximately 16,000
people, Global Bilgi
creates value as a
pioneer of its sector
with 9,600 women
employees, who
make up 60% of the
total workforce.
Turkcell family employees*
Female
Male
Female
Male
Female
Male
2018
2019
2020
32%
1,722
People
68%
3,633
People
32%
1,770
People
68%
3,685
People
33%
1,877
People
67%
3,772
People
Ratios of current employees by age groups*
30 years and under
Between 30 - 50
50 years and older
2018
19%
77%
4%
Education level of our employees*
Doctorate (PhD)
Master’s degree
Bachelor’s degree
Associate degree
High school
Other
2018
1%
26%
66%
3%
3%
1%
2019
22%
75%
3%
2019
1%
28%
66%
2%
2%
1%
2020
25%
72%
3%
2020
1%
25%
69%
2%
3%
1%
Ratios of current managers by age groups*
30 years and under
Between 30 - 50
50 years and older
2018
-
94%
6%
2019
-
95%
5%
2020
0.3%
94.8%
4.9%
Employees who left the Company*
Female
Male
Female
Male
Female
Male
2018
2019
2020
32%
151
People
68%
327
People
27%
162
People
73%
438
People
28%
125
People
72%
317
People
Age groups of employees who left the Company*
30 years and under
Between 30 - 50
50 years and older
2018
18%
77%
5%
2019
21%
71%
8%
2020
34%
63%
3%
Employee turnover*
Gender ratio breakdown per position*
Female
Male
Female
Male
Female
Male
2018
2019
2020
Female Male
Female Male
Female Male
Below manager
33.5%
66.5%
Manager
Director
21.3%
17.9%
78.7%
82.1%
33.8%
22.2%
66.2%
34.6%
65.4%
77.8%
23.0%
77.0%
13.3%
86.7%
16.9%
83.1%
2018
2019
2020
3%
6%
3%
8%
2%
6%
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
133
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134
Our new mothers
are offered the
opportunity of
working in the office
between 10.00-15.00,
and from any location
of their choice for
the rest of the day,
until their babies
are 16 months old.
Meanwhile, though
legal provision for
paternity leave in
Turkey is 5 days, we
provide 10 days of
leave to our new
fathers, so that our
male employees
can assume greater
responsibility in
childcare.
SDG 5.4
Voluntary employee resignation rates*
Voluntary resignation
2018
5%
2019
6%
2020
6%
Employees who received an exit interview*
Number of employees
Number of completed surveys
Participation rate
2019
271
157
58%
2020
312
163
52%
Employees taking parental leave*
2018
2019
2020
Short-
term
target
Mid-
term
target
Long-
term
target
Number of
employees
who used
their parental
leave right
Rate of
employees
returning to
work after
their parental
leave
Employee
retention
rates
following
parental
leave
40
52
60
-
-
-
100%
98%
97%
98%
98%
98%
85%
88%
93%
88%
90%
90%
We manage our Compensation Poli-
cy at all levels with maximum relia-
bility. We transparently communicate
the Remuneration Policy of our Board
Members and Senior Managers to all
our stakeholders.
We apply our remuneration policies
impartially by basing all our operati-
ons on common standards to prevent
discrimination between our female
and male employees performing si-
milar jobs.
SDG 5A
In addition to a
range of social
responsibility
activities that
we undertake
to support
the active
participation
of disabled
individuals in
business life, we
have provided
employment
for 13 disabled
people, 3 of
whom are
Young Talents
as part of our
Young Talent
Program in
2020.
Rate of average entry level wage to minimum wage (times higher)*
Female
Male
Female
Male
Female
Male
2018
2019
2020
3.5
3.5
2.8
2.8
2.6
2.6
Transparent performance
evaluation
All Turkcell employees are included
in the annual performance evalu-
ation process that is conducted in
a transparent and fair manner. As
part of the annual salary increase
process, which covers all employ-
ees, the following criteria set is
taken into consideration; macro
and socio-economic
indicators,
sectoral developments, company
performance and dynamics, inter-
nal comparisons, the market value
of the respective role, individual
performance and sustainable per-
formance (performance and tal-
ent management results).
As part of the Goal Setting pro-
cess at Turkcell, each employ-
ee is expected to set their goals
together with their superior and
keep those goals updated with
the changing priorities throughout
the year. Strategic initiatives de-
termined as part of the company
strategy are included as key initi-
atives firstly on the scorecards of
our senior management. KPI sets
that support those strategic in-
itiatives are also included on the
scorecards of employees. Employ-
ees connect their goals to those
of their superior in a way to also
match the strategic initiatives of
the Company. Accordingly, a ho-
listic “Goal Tree” is created, illus-
trating connections between the
objectives and strategic initiatives
of the C-level executives of the re-
spective functions.
We rely on the power of communi-
cation. The Voice of Managers pro-
gram provides our managers the op-
portunity to give direction to Turkcell
strategies under the leadership of
our Strategy Department. We bring
our directors together at Voice of
Directors meetings organized in con-
venient settings where ideas can be
exchanged. The Voice of Employees
survey enables our employees to ex-
press their opinions and suggestions
transparently.
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
135
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136
Employee loyalty and happiness
We are working towards enabling an
efficient and enjoyable employment
experience with “How About Conne-
cting to Life?” slogan. We keep open
dialogue with our employees through
Employee Engagement Surveys, and
continuously review the effectiveness
of our practices in accordance with
the results obtained. In 2019, we ran-
ked among the ‘Best Workplaces in
Turkey’ based on the results of Emp-
loyee Engagement Survey.
We continued our
success with the
Virtual Working
Assessment Survey
regarding the
COVID-19 period in
2020, and were proud
to top the list among
both local and global
companies.
We appreciate our employees:
With our “CEO and CXO awar-
ds”, our CEO and C-level exe-
cutives reward employees who
make a difference. Our instant
rewarding platform enable exe-
cutives to give awards to emplo-
yees with successful performan-
ce over Mobilim application. We
reward
innovative employees,
those who add long-term va-
lue to our Company through the
“This deserves an award” initiati-
ve. Through our “Innovation Plat-
form”, we canvass opinions of
employees on issues determined
by the business departments,
rewarding those with the most
innovative suggestions. Emplo-
yees, who complete their 5th, 10th,
15th, and 20th years of service, are
awarded a specially prepared
thank-you package and celeb-
rated at our “Seniority Awards
Ceremony”. Besides asking for
business ideas, we also encou-
rage our employees to partici-
pate in activities such as Turkcell
Volunteers that have a positive
social impact.
As a side benefit, we provide all
part-time and full-time employees
of Turkcell Turkey companies life in-
surance against death and critical
illness. We also offer accident and
post-illness disability insurance as a
side benefit. The health package of-
fered to our employees covers inpa-
tient and outpatient treatment, child-
birth, dental treatment and glasses/
lenses. Additionally, our employees,
their spouses and children all benefit
from this coverage. In addition to le-
gal paternity leave, our male emplo-
yees are entitled to 10 calendar days
of leave upon becoming a father. The
Turkcell Private Pension Plan covers
all employees, who complete their 6th
month at Turkcell. Our employees can
all own Turkcell Company shares.
We believe in the importance
of feedback in the successful
management of our business
processes. ReFlex, our digital fe-
edback mechanism, allow us to
provide feedback instantly. Over
the ReFlex system, which can be
accessed via mobile and our Hu-
man Resources mobile applica-
tion Turkcell Life, we help emp-
loyees with performance and
goal management, appreciate
success, provide constructive fe-
edback with an aim to maximize
work efficiency and employee
satisfaction.
Number of ReFlex responses from employees*
2018
2019
2020
Short-term
target
Mid-term
target
Long-term
target
24,065
36,715
39,560
40,000
45,000
-
50,000
50,000
We closely
follow the legal
obligations
regarding
Occupational
Health and
Safety (OHS)
within the
framework of
our Occupational
Health and
Safety Policy,
organize
trainings,
regularly auditing
our activities and
checking their
pertinence.
Safe and healthy work environment
In accordance with our motto “Above
all comes the health of our employe-
es”, one of our key responsibilities is to
ensure full safety in all our work en-
vironments, and to protect the health
and well-being of all our employees
under the expertise of Turkcell Group
Occupational Health and Safety Unit.
Firstly, we closely follow the legal ob-
ligations regarding Occupational He-
alth and Safety (OHS) within the fra-
mework of our Occupational Health
and Safety Policy, which is in comp-
liance with Occupational Health and
Accident frequency rate*,**
Safety Law No. 6331 and the ILO-OSH
(ILO Occupational Safety and Health)
2001 standard. We organize trainings,
regularly auditing our activities and
checking their pertinence. We mana-
ge the physical security standards of
our buildings and facilities in accor-
dance with Private Security Services
Law No. 5188 and the respective re-
gulations. In addition to their profes-
sional training, all of our security per-
sonnel are informed of Turkcell dyna-
mics by their own companies before
starting work at Turkcell.
Gender
Unit
2018
2019
2020
Short-
term
target
Mid-
term
target
Long-
term
target
Female
Male
Total
Number of
accidents
/ working
hours
Number of
accidents
/ working
hours
Number of
accidents
/ working
hours
2.37
2.07
1.38
1.85
2.15
0.68
2.09
2.11
0.89
2
2
2
1
1
1
0
0
0
** The accident frequency rate is calculated by multiplying “the ratio of the total number of
accidents to total working hours” by 1 million.
Number of accidents*
Number of occupational
diseases*
Gender
2018
2019
2020
Gender
2018
2019
2020
Female
Male
Total
11
12
23
26
27
53
5
5
10
Female
Male
Total
0
0
0
0
0
0
0
0
0
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
137
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138
In the field of Occupational Health
and Safety (OHS), our RADAR soft-
ware program developed by Turkcell
Teknoloji Araştırma ve Geliştirme A.Ş.,
offers employees
the opportunity
to report dangerous situations and
follow up on their status. Through
Turkcell’s RADAR application, we
evaluate employee suggestions and
complaints
regarding occupational
health and safety issues according
to the risk categories. We transpar-
ently share Turkcell Group indicators
with our employees, such as accident
frequency rate, details of the accident
and total lost days.
RADAR, which is part of the Corpo-
rate Occupational Health and Safety
Management System, uses criteria
determined by Turkcell Occupational
Safety Experts. It has been developed
by Turkcell Teknoloji software devel-
opers as a system in compliance with
prevailing legislation. It is a system
not only used for document tracking,
but also one that allows occupation-
al health and safety professionals to
carry out their responsibilities. Thanks
to RADAR, the occupational health
and safety performance across Turk-
cell Group companies is calculated
as an annual score and monitored by
the management. The scoring criteria
is determined in accordance with the
penalty scoreboard table of the rele-
vant legislation.
Loss of working hours due to occupational accidents*
104 hours
2018
920 hours
2019
32 hours
2020
Third party OHS data
2018
2019
2020
Female Male
Female Male
Female Male
7
4
3
6
2
15.4
8.8
6.6
13.2
4.4
0
0
0
0
24
16
112
184
0
0
0
0
0
0
Number of
accidents (third
parties)
Accident
frequency rate
(third parties)
Number of
occupational
diseases (third
parties)
Loss of working
hours due to
occupational
accidents (hours)
(third parties)
OHS training hours*
Female
Male
Total
2018
928
1,013
1,941
Number of entry health examinations*
Female
Male
Total
2018
434
742
1,176
2019
7,128
18,384
25,512
2019
321
475
796
2020
3,520
4,992
8,512
2020
127
262
389
We became the
first company
in the sector
to receive the
“TSE COVID-19
Safe Service”
certification
of the Turkish
Standards
Institute. During
the pandemic
period, we
quickly adapted
our offices to
the requirements
given in circulars
issued by official
institutions,
and we focus
on continuous
improvement to
ensure that our
offices remain
healthy and
safe.
Number of periodic health examinations*
Female
Male
Total
2018
442
573
1,015
2019
373
531
904
2020
114
194
308
RADAR Turkcell Group performance score*
2018
2019
2020
Short-term
target
Mid-term
target
Long-term
target
98.2%
98.9%
98.7%
98.5%
98.7%
99%
We communicate OHS issues to all
our employees on the Turkcell OHS
Portal. We expect our business part-
ners to comply with our OHS Policy
and ensure that they take measures
within this framework through our
business contracts. Our OHS experts
analyze all occupational accidents
and OHS data. Reporting the sta-
tistical data gathered from incident
reports to senior management on a
monthly basis, we determine our oc-
cupational health and safety targets
as well as our future action plan.
Health and Wellness Programs
We are dedicated to the health
and well-being of our emplo-
yees. In this context, we recei-
ve support from our workplace
physicians, psychologists, dietici-
ans and sports trainers to ensure
that our employees live a healthy
life. For the little ones of our fa-
mily, we offer a one-on-one me-
eting opportunity with our com-
pany pedagogue. We have imp-
lemented programs concerning
the beloved living creatures of
ourselves and our families. Duly,
as Turkcell members, we have
access to information on our
animals and plants through the
Veterinary and Home / Garden
Plants Consultancy support line.
Our productive Turkcell family
With our strong team that shapes the
future, we base our organization on
flexible and agile foundations. We
work across a diversity of fields to
grow our strong and agile Turkcell
Family and continuously take it one
step further. By adopting an “equal
opportunity” approach to education,
we provide all our employees with
the opportunity of self-improvement,
regardless of their duties and respon-
sibilities within the Company. Within
the scope of Turkcell Talent Manage-
ment, we realize backup manage-
ment and the YUPO (High Potential)
Program.
Turkcell backup management
Employees working in manage-
ment positions (C-Level, General
Manager, Director, Manager) and
critical expert positions, who are
critical in implementing company
strategies, are backed up by in-
ternal and/or external sources.
This contributes to the business
continuity and sustainable per-
formance of the company.
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
139
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140
Human capital
YUPO (High Potential)
Launched in 2019, YUPO is a
program that identifies em-
ployees with distinctive talents,
who transform these talents
into high performance, perform
in line with Turkcell culture and
values, and help carry Turkcell
to the future. In pursuing suc-
cess at Turkcell, we believe
that Turkcell employees who
proactively strive to benefit
their customers, country, team
and
themselves, deserve a
motivational privilege, and
YUPO exists precisely with this
in mind. YUPO features volun-
tary experts who meet to set
related criteria. YUPOs have
priority participation in certi-
fication programs at interna-
tional universities, apprentice-
ship programs in Turkey and
abroad, and conferences and
seminars. In addition, thanks to
the various networking oppor-
tunities available to them, they
can both increase their impact
and gain access to platforms in
which they can share their in-
tellectual knowledge.
Turkcell Academy
With Turkcell Academy, Turkcell’s cor-
porate university, we remain beside
our employees on their journey of de-
velopment. Dozens of Turkcell Acade-
my initiatives ensure the competen-
cy of our productive Turkcell family,
while preparing Turkcell and Turkey
for the digital transformation of the
future. In 2020, Turkcell Academy set
about making a difference by pre-
paring over 56,000 employees and
business partners in our ecosystem
for the future. We have implemented
diverse trainings to improve Turkcell
and its ecosystem in 2020 through our
new graduate employment program
Young Talent and Digital Masters Pro-
grams. The program is implemented
across the Company with the leader-
ship programs we have prepared at 6
levels and training development jour-
neys prepared for various functions
and field teams.
SDG 4.3, 4.4
Total training hours*
1.9 million
2018
2.2 million
2019
1.4 million
2020
Number of employees participated in Turkcell Academy
trainings*
3.5 million
2018
3.6 million
2019
3.3 million
2020
Gender breakdown of our employees participated in
Turkcell Academy trainings in 2020*
Female
54%
Male
46%
the
leadership of Turkcell
Under
Academy, which has received over
40 international awards since its
establishment as Turkey’s first cor-
porate university, we support digital
transformation in education by co-
operating with leading universities in
Turkey and around the world, as well
as educational institutions. We attach
great importance to the development
of our Academy Instructors; whose
expertise makes a valuable contribu-
tion to the educational processes of
our family. With over 600 instructors,
200 of whom are active, we carry out
programs with Boğaziçi University to
improve their teaching skills on the
one hand, while on the other support-
ing them with trainings to enhance
their expertise.
Age breakdown of our employees who participated in
Turkcell Academy trainings in 2020*
30 years and under
Between 30 - 50
50 years and older
67%
32%
1%
Number of Turkcell Academy instructors
610 instructors
2018
623 instructors
2019
676 instructors
2020
Turkcell ecosystem
features trainings
under 6 diverse
topics within the
scope of Primary
Mandatory
Trainings. We offer
“Occupational
Health and Safety
Trainings”, as
well as trainings
in “Information
Security”, “Business
Continuity”, “Anti-
Bribery and
Anti-Corruption”,
“Competition
Law” and “Turkcell
Values and
Business Ethics
Rules” with the
participation of all
our employees.
Training hours per employee*
Turkcell primary mandatory trainings*
68 hours
2018
66 hours
2019
33 hours**
2020
22,330 hours
2018
32,809 hours
2019
21,792 hours
2020
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
** Due to the pandemic, we have converted our face-to-face trainings to live and virtual classrooms of fewer hours in the digital environment.
TURKCELL INTEGRATED ANNUAL REPORT 2020
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
TURKCELL INTEGRATED ANNUAL REPORT 2020
141
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142
Digital Masters
With the Turkcell Digital Mas-
ters Program, focused on new
generation
technologies set
to shape tomorrow’s world,
and on developing pioneering
products and services, we aim
to raise our employees’ ex-
pertise to the highest level in
this field. Within the scope of
the Digital Masters’ Program
prepared in cooperation with
Udacity and Turkcell, we offer
online trainings in the fields of
Business Analytics, AI Program-
ming with Python, Computer
Vision, NLP, Blockchain Devel-
oper, Programming for Data
Science, AI, Data Scientist, In-
troduction
to Programming,
Machine Learning, Cloud De-
veloper and Introduction to ML.
To date, 2,503 Turkcell employ-
ees have applied to the Digital
Masters’ Program. 2,195 people
have taken the exam conduct-
ed by Udacity and a total of
1,050 Turkcell employees were
entitled to receive training. Our
participants who successfully
complete trainings and pro-
jects receive the Udacity Nano
Degree Certificate.
Ratio of internet-based trainings to all trainings*
93%
2018
91%
2019
91%
2020
Technology Retailing
Certificate Program
This is the sector’s first and only Tech-
nology Retailing Certificate program,
designed to enable employees wor-
king in Turkcell’s retail and corporate
sales channels to serve our custo-
mers to the standards set by Turkcell.
As part of this program, our emplo-
yee candidates receive training on
Turkcell products and services, new
technologies, sales techniques and
customer experience. After the know-
ledge exam and competency evalu-
ations, those employees qualified for
certification commence their journey
of providing superior customer servi-
ce. The certification rate of emplo-
yees working in our sales stores has
been at 95% for 3 years. From mea-
surements made after the initial year
of the program, it was observed that
the employee turnover rate had dec-
reased by 30%.
D E V E L O P Y O U R C O N S U L T I N G
C O M P E T E N C E W I T H T H E T U R K C E L L
A C A D E M Y D I G I T A L
TRANSFORMATION CONSULTANT PROGRAM
G E T R E A D Y F O R T H E F U T U R E!
The most comprehensive consulting program in
Turkey that is prepared uniquely for corporate sales
teams and provide guidence to the digital
transformation journey of our customers, has
began!
https://tag.turkcell.com.tr
Digital Transformation
Consultancy Development
Program
We conduct
the Digital
Transformation Consultancy
Development Program
to
develop the competencies
and skills of our employees
in the corporate sales and
Digital Business Services
team. It plays a key role in the
success of Turkcell’s digital
business services initiative
that guides our customers
along their journey of digital
transformation.
Turkcell Academy
Young Talents Program
Within the scope of the Young Talent
Program, which has been implement-
ed to recruit talented young people,
Turkcell offers a fully online 4-month
training program specifically de-
signed for new recruits. The compre-
hensive orientation in the program
includes Turkcell, Customer, Technol-
ogy, Life and Entrepreneurial Leaders
modules. The program is offered with
digital learning, artificial intelligence
technologies, experiential
learning,
skill development, social responsi-
bility projects, and different learning
methods where simulation and learn-
ing are applied together. Program
participants shared 450 suggestions
for improvements to customer expe-
rience by listening to over 7,000 calls
from the “My Customer Voice” plat-
form in 2020.
The program trainings are organized
with the corporate universities of
technology companies such as Hua-
wei, Oracle, Cisco, Ericsson, Nokia
and Dell, as well as Turkcell Technol-
ogy teams, in order to develop the
technology vision of Young Talents.
Through these corporate universities,
which we strategically cooperate
with, participants receive training in
artificial intelligence, cyber security,
data center, data analysis and block-
chain. They also receive information
from Turkcell Technology teams on
the operation of these technologies
at Turkcell. In the “Life” step of the
program participants attend semi-
nars on motivation, psychology and
leadership approaches.
In the “Entrepreneurial Leaders” mod-
ule, which we designed as the final
module of the program, our Young
Talents receive training from Koç Uni-
versity on subjects such as customer
focus, innovation, digital trends, lead-
ership, strategic thinking, and finance,
and experience Strategic Business
Management Simulation.
In addition to this development jour-
ney, Young Talents provide social
benefits helping children undergoing
treatment as part of our social re-
sponsibility projects by making them
smile. When Young Talents upload
their smiling photos to the ‘Young
Talent 2020’ channel on the BiP plat-
form, their photos transform into toys
for the children. Therefore, with this
project, they get the opportunity to
experience Turkcell’s focus on creat-
ing social benefit at first hand.
Developers of the Future - Young
Talent & Stajcell Project
In 2020, we contributed to the ca-
reers of all candidates who applied
to Young Talent and Stajcell projects
by providing training and certifica-
tion during the recruitment process.
For the first time in a recruitment pro-
cess, candidates began training be-
fore being hired. We contributed to
the careers of 5,890 candidates who
applied to the Young Talent process
through the trainings they received
from the Developers of the Future.
We supported 828 candidates keen
to complete internships at Turkcell
along their career paths through De-
velopers of the Future trainings.
With the CX Lab Customer
Experience Development Program
With the CX Lab Customer Experien-
ce Development Program, we have
aimed to improve the customer-o-
riented design perspectives of our
customer experience teams.
With CX Lab, we introduced a brand-
new modem and service model with
smart home assistant feature of Turk-
cell Evim 360 as part of our fixed in-
ternet services. On the financial servi-
ces front, as part of TechFin solutions,
we have developed a new service
that can be used to track spending
and savings via Paycell Wallet.
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
143
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144
“Flex” human resources
of the digital age
At Turkcell, our human resource
practices comprise a flexible,
digital platform that we call
“Flex”. We enable our employ-
ees to customize and person-
alize almost any application
we offer them through our Flex
HR system as part of our jour-
ney to becoming “Digital HR”.
With FLEXSourcing, another
Flex application, our productive
Turkcell family can voluntari-
ly invest 20% of their working
time in innovative projects that
require different perspectives,
expertise and a variety of
competencies. With our FLEX-
Sourcing application, which
offers diverse options from ar-
tificial intelligence to gamifica-
tion, and from data analytics to
crowdfunding, over 300 Turk-
cell employees participated in
more than 50 voluntary pro-
jects in the 2019-2020 period,
generating value for Turkcell.
Our agile teams
At Turkcell, we consider our business
units’ agility, strength and flexibility
to be the greatest source of our suc-
cess. With agile teams being one of
the four main competencies toward
achieving Turkcell’s strategic initia-
tives, we work to establish a flexible
and agile structure from Network to
Finance, and from Law to Marketing,
across our entire productive Turkcell
family. In 2020, we improved our or-
ganizational structure even further
in terms of agility. We are proud to
have increased the number of agile
teams this year from 85 to 181, helping
us to take full advantage of our em-
ployees’ talent and experience. We
effectively manage our company re-
sources to realize our strategic focus
areas. We maximize agility by opti-
mizing our business processes with
Making a difference in employment
As one of Turkey’s
largest employers,
we are a vast family
of over 24,000
employees with our
local and international
subsidiaries.
Despite the adverse conditions of the
pandemic during 2020, our human
resources strategic planning success-
fully increased our business volume
without delaying recruitment. Given
our aim of providing a superior digital
product and service experience, and
our increasing workload in this peri-
od, we continue to seek professionals
of technological expertise. Yet we do
not limit our recruitment to these ar-
eas alone; we continue to recruit in
many areas ranging from information
our end-to-end value-generating
organizational structure. The organ-
izational structures of new business
areas are updated according to mar-
ket needs. We determine application
areas by monitoring the performance
of the pilot applications of our agile
working model. And through master
and management programs we con-
tinuously invest in our human capital,
bringing young talent to Turkcell with
the most comprehensive recruitment
program in Turkey.
You can find detailed
information about our resource
allocation in the strategic
initiatives and opportunities
section of our report.
and communication
technologies
to finance, and from marketing and
sales to human resources. As Turkey’s
digital operator, we have largely dig-
italized our recruitment process and
employee experience. In this context,
especially during the pandemic pe-
riod, we have made increased use
of online assessment tools, employ-
ing artificial intelligence technology
in our recruitment process as part of
our innovative approach. In our new
graduate recruitment process, dur-
ing the video interview phase, we
have used artificial intelligence in the
mood-assessment of approximately
3,000 candidates. When the results
of one-on-one interviews we con-
duct match with artificial intelligence
analysis, we deem it as an indicator
of success for our evaluation process.
Our use of artificial intelligence in re-
cruitment will continue to increase.
increases
Young Talents Program
Turkcell launched the Young
Talent Program in 2016 to re-
cruit talented young people.
The need to “quickly master
difficult jobs” that comes with
digitalization,
the
importance of
flexible and
agile teams. Today’s business
world is looking for versatile
talent. The main purpose of
our employment policy is to
add talents who will resolute-
ly achieve results, pursue their
dreams, possess high techno-
logical aptitude, and who can
quickly adapt to new condi-
tions. As a result, we open our
doors to professionals who are
experts in their fields, as well
as young people who have
just began their career. A key
innovation of the program this
year was the development of
online application and evalua-
tion processes to provide 100%
equal opportunity for disabled
candidates. As a result of this,
3 visually impaired candidates
who successfully passed all
stages joined the Turkcell fami-
ly as Young Talents. We see the
Young Talent program not only
in terms of youth employment,
but also as an investment in
new human resources required
for digital transformation that
will carry our country into the
future.
New hires*
Full-time
Part-time
New hires by gender*
Female
Male
2018
728
12
2018
265
475
2019
590
2
2019
174
418
2020
723
0
2020
262
461
We draw particular attention to so-
cial equality of opportunity and an-
other priority topic, women’s employ-
ment, with the Women Engineers
Project. We offer job opportunities at
Turkcell by developing special work-
ing models for women who have nev-
er worked before, or who are current-
ly unable to work for various reasons
such as marriage or motherhood.
Accordingly, we conducted a project
launched with the “Equal Conditions,
Equal Chances” motto, aimed at in-
creasing the employment of women
engineers in 2 phases. The first phase
involved advertisements for female
engineers who are 3rd and 4th grade
students. Following the evaluation of
received applications, we conducted
general skill and technical tests, and
one-on-one human resource inter-
views. 101 people who successfully
completed the process were entitled
to participate in 6-week IOS, Java,
C# and Android trainings. Those who
successfully complete the program
in the technology camp, set to take
place in the digital environment with
projects created by expert instructors,
will have the opportunity to work at
Turkcell, either part time or full time.
Our efforts to increase the employ-
ment of women who have taken a
break from their career, which is the
second phase, is ongoing.
Number of applicants to the Young Talent Program*
60,000
2018
28,500
2019
63,000
2020
Employment provided through the Young Talent Program*
235 people
2018
153 people
2019
150 people
2020
* Demographic information presented in our human capital section covers data from the companies Turkcell İletişim Hizmetleri A.Ş., Kule Hizmet ve İşletmecilik A.Ş., Superonline İletişim
Hizmetleri A.Ş., Turkcell Enerji Çözümleri ve Elektrik Satış Ticaret A.Ş., Turkcell Finansman A.Ş., Turkcell Ödeme ve Elektronik Para Hizmetleri A.Ş., Turkcell Satış ve Dijital İş Servisleri A.Ş.,
Turkcell Sigorta Aracılık Hizmetleri A.Ş., Turkcell Teknoloji Araştırma ve Geliştirme A.Ş., Lifecell Dijital Servisler ve Çözümler A.Ş., Lifecell TV Yayın ve İçerik Hizmetleri A.Ş., Lifecell Müzik
Yayın ve İletim A.Ş., Lifecell Bulut Çözümleri A.Ş. and BİP İletişim Teknolojileri ve Dijital Servisler A.Ş. Employee numbers were provided by Turkcell’s Employee Experience Management
Directorate, and did not change significantly during the year.
145
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146
Stajcell
Hundreds of young people can dis-
cover their talents by completing
internships at various Turkcell de-
partments thanks to the STAJCELL
program. The STAJCELL program pro-
vided internship opportunities to 200
young people in the summer of 2020.
We are constantly expanding our
talent pool with the project camps,
hackathons and online competitions
we organize throughout the year.
Stajcell Plus
With StajcellPlus, we provide part-
time employment to young people
who stand out in the Stajcell program,
delivering social benefit by providing
business experience to those set to
start their career in Turkey, and iden-
tifying young people of high poten-
tial to steer in the right direction. Our
target audience in this program is
3rd and 4th grade university students,
and we conduct orientation trainings,
Cross Talk, HR Talks, monthly CXO Tea
Talks and project design activities.
The StajcellPlus program began with
45 participants on October 1, 2020. At
the end of this 6-month program, we
aim to evaluate full-time employment
opportunities as part of this project in
January 2021.
The Stars Coming Back
With the “The Stars Coming Back
project”, which we launched in 2020
as part of our recruitment strategy,
we urged Turkish citizens working
abroad to make applications to ap-
propriate roles at Turkcell. We aim
to contribute to Turkey’s intellectual
capital and make a major investment
in the future with this project. Our
project is geared at making econom-
ic and social contributions by stimu-
lating the reverse brain drain.
With the principle of adding value
to society, we offer interview train-
ing and information to all candidates
prior to their interviews. After the in-
At Turkcell it’s Equal
Conditions, Equal Chances!
At Turkcell,
“Equal Conditions,
Equal Chances” is a program
aimed at increasing our employ-
ment of female engineers. We in-
vite students, or newly graduated
female engineers to interviews
once they pass an online exam,
and organize the “Technological
Women Bootcamp” program for
our successful candidates. At this
stage, our candidates participate
in the training programs of Turk-
cell Academy to realize projects.
We offer employment opportu-
nities to those candidates whose
projects are successful. At Turk-
cell, another focus of the “Equal
Conditions, Equal Chances Pro-
ject” is the reinstatement of our
female engineers who have tak-
en a break from their career for
various reasons such as marriage,
birth or relocation. We believe this
investment enables us to highlight
the qualified workforce of wom-
en in our country and contribute
to both Turkcell and Turkey eco-
nomically and socially.
terview, regardless of whether it was
positive or not, we thank our candi-
dates for seeing Turkcell as their em-
ployer of choice with internet gifts.
With our “Tell Your Candidate, Cre-
ate Benefit” application, we expect
Turkcell employees to recommend
talented external candidates for va-
cant positions on HR Life. If the can-
didate proposed by our employees
successfully completes all processes
and joins us, we offer our employee
a small thank you gift through Paycell.
The interaction of our
human capital with
other capitals
Our productive
Turkcell family
provides one of the
greatest contribution
to the development
of our sector and
country, combining
its dreams with
technology and
communication,
and with the
privilege of being
a Turkcell member.
Our employees
are the preeminent
component in
transforming
our financial,
manufactured,
intellectual and
natural capital into
the value created
by the Turkcell
business operations.
At the same time,
our human capital
is representative of
our social values
and relationships,
and those of our
stakeholders, with
whom we create
shared value.
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Manufactured
capital
152
Strong network
156
Strong fiber infrastructure
157
Strong spectrum
158
International sale and wholesale
159
Data centers
150
Manufactured capital
Manufactured capital
Inputs
Outputs
Value created
Strong network
• Base stations
• Towers
• Redundant and integrated infrastructure
• Telco cloud
• Investment in domestic equipment
• Service Operations Center (SOC)
Strong spectrum
Strong fiber infrastructure
Data centers
4.5G
speed
(up to 1.4 Gbps)
76%
network traffic
increase rate
Outputs
10,281
base station sites with
risk assessment
51%
network
virtualization
rate
99.96%
data accessibility
rate
Fiber internet
speed up to
10 Gbps
Tower
portfolio of
10,913
Offering fast, quality and
inclusive services
• Providing high quality services
to our customers
Contribution to keeping Turkey’s data
in Turkey
• Turkey’s largest data center operator
• Contribution to data security
Leadership in technology and digital
transformation
• Network ready for new technology
transformations
Access to information and internet for
everyone
Improving domestic and national
technological infrastructure
• Applying innovative technologies
not previously applied in Turkey to our
infrastructure and making a difference
in the market
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Strong infrastructure and
superior service quality
We ensure the delivery of
reliable and high speed
services to our customers
leveraging superior
digital competencies,
strong financial
management and 27
years of experience
in the telecom sector.
We closely follow
technological trends
and develop world-class
applications to maintain
strong infrastructure
and superior service
quality, which are
among the material
topics for Turkcell and
our stakeholders. While
carrying out activities to
support the development
of domestic technologies,
we also engage in
international projects
and promote our brand
beyond our country. We
are proudly the largest
data center operator in
Turkey, carrying out our
activities in this area
in support of domestic
technology development.
We operate our base
stations with an
approach that ensures
compliance with national
and international
standards with a
performance that goes
beyond their minimum
requirements, paying
utmost attention to the
health of our valuable
customers and overall
society.
As part of our manufactured capital,
we continue to invest in our infrast-
ructure to add value to the digital
journey of our customers. We have
a strong access network built over
rich frequency resources enabling us
to offer one of the fastest 4.5G servi-
ces in the world. In accordance with
our vision that “Turkey’s data should
remain in Turkey”, we continue our
activities as the largest datacenter
operator in Turkey. Meanwhile, we
support and actively participate in
projects related to the domestic ma-
nufacturing of network equipment.
We also expand our fiber infrastruc-
ture to deliver services to more hou-
seholds. We comply with regulations
and ensure high service quality as an
exemplary corporate citizen.
Strong network
We know that a reliable and fast
network with a large coverage is of
great importance in delivering a suc-
cessful customer experience. In this
regard, we continuously improve our
infrastructure
investments
through
and R&D activities. The pace of de-
velopment of today’s technologies
requires companies to actively follow
trends in creating and implementing
new services and solutions. We also
support our country’s technological
development carrying out activities
to implement the latest infrastructure
solutions and develop domestic tech-
nologies. In the meantime, by impro-
ving our service quality, we also grow
our revenues.
Expanding our strong fiber infrastruc-
ture annually, we grow the number of
fiber-connected base stations. More-
over, we provide fiber access to hou-
seholds in additional cities.
Along with infrastructure investments,
we take measures to increase the ef-
ficiency of our network implementing
new technologies so as to effecti-
vely manage the annually increasing
network traffic of our customers.
Hence, we do not compromise on
service quality even during busy pe-
riods by maintaining efficient use of
network resources. The rise in traffic,
particularly in 2020 due to COVID-19,
which was higher than expected,
once again underlined the importan-
ce of infrastructure investments and
efficiency efforts for service quality.
COVID-19 note
Curfew measures, increa-
sing remote working and
remote education practices,
have resulted in significant
rise in fixed internet usage
and 4.5G data traffic. Ac-
cordingly, we took measu-
res to increase capacity and
meet additional 4.5G traffic
load on the network during
this period. We continue our
activities to effectively ma-
nage the higher demand
for data usage over Super-
box and fiber offerings, and
provide high quality service.
With our data centers, we
have offered our corpora-
te customers the ability to
manage their data 24/7, re-
motely.
Mobile infrastructure
Our mobile infrastructure possesses a
smart and flexible network structure
comprising mainly our base stations.
We carry out activities aiming to im-
prove the coverage area and dura-
bility of our base stations and towers,
which form the basis of our telecom
business, thereby increasing the ac-
cessibility of our services.
Base stations
Having adopted an approach pri-
oritizing public health, we operate
our base stations utilizing the latest
technologies and in compliance with
national regulations and international
standards. We also locate our base
stations accordingly to avoid creat-
ing any sort of visual pollution.
The base stations in our network are
well equipped to demonstrate all ca-
pabilities of the technology that we
provide to our customers.
Meanwhile, our base stations, which
can offer multiple technology support
(singleRAN), can be defined as envi-
ronmentally friendly with their more
compact size and lower energy con-
sumption.
%
6
7
0
2
0
2
%
8
3
9
1
0
2
%
4
2
8
1
0
2
Network traffic increase
Rate in bandwidth*
Base stations and public health
In order to prevent any negative im-
pact on public health, our base sta-
tions must operate below the elec-
tromagnetic field intensity threshold
levels determined by the Regulatory
Authority, the ICTA. These thresholds
were determined by the ICTA with a
prudent approach at lower and saf-
er levels compared to the exposure
limits determined by the Internation-
al Non-Ionizing Radiation Protec-
tion Board (ICNIRP) and accepted
by the World Health Organization
(WHO). As per research in this field,
no harm to human health has been
identified from radio signals below
ICNIRP limits. The threshold levels
defined for Turkey by regulation are
at 70% of the limits determined by
ICNIRP, and at 25% per device. The
maximum limits that a base station
can be operated at in our country
are much lower (approximately 1/4)
compared to limits set for European
Union countries.
We are subject to the ICTA and
its respective regulations with re-
gards to installation and inspection
of base stations. As part of the in-
stallation process of a base station,
information regarding the power
specifications, the antenna type,
location of the station and its sur-
rounding is reported in detail to the
ICTA. The base stations can be in-
stalled in approved locations. Once
a base station is activated, EMR
(Electromagnetic Field) measure-
ment is conducted by independent
institutions accredited by the ICTA
within one week, with the results
submitted to the ICTA. Moreover,
the ICTA also conducts inspections
and measurements on the base
stations. As part of the two ICTA
criteria that stand out with respect
to public health, there should be no
living space within the “Safety Dis-
tance” determined based on the
power output of the base station,
while its electromagnetic field in-
tensity, having been configured ac-
cordingly, should be within the legal
limits. Should any failure to comply
with the relevant ICTA criteria be
detected, the base stations are dis-
mantled, with significant sanctions
or penalties imposed.
As Turkcell, we effectively manage
the impact of our network oper-
ations on public health by imple-
menting much stricter limits com-
pared to those set by the legal
authorities. In 2020, there were no
cases that resulted in legal penal-
ties against our Company with re-
gards to the impact on health of our
products and services.
Moreover, we conduct risk assess-
ment tests to ensure the safety of our
base stations and our teams work-
ing in the field. Having conducted risk
assessment tests at 8,832 base sta-
tion sites in 2019 and 10,281 in 2020,
we are one step closer to achieving
our short-term target of conducting
10,800 risk assessment tests each
year. We aim to minimize risk factors
to the greatest possible extent by im-
plementing improvement actions for
areas identified as a result of these
assessments.
* Total data volume: mobile + fixed
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As part of our activities carried out
at base station sites, we encounter
occupational health and safety risks
in relation to issues including working
at height, electrical works, excava-
tion works, and vehicle use. In order
to avoid these risks, we rely on our
working principles and action plans.
Until the end of 2020, 4,051 sites were
inspected, risk analysis forms were
prepared for 1,449 sites, and 590 sites
were repaired for a safer working en-
vironment.
Moreover,
“Network
in preparing
Technologies Geographical Risk Anal-
ysis Reports” on a regular basis, we
aim to ensure that our base stations
operate efficiently, in an environmen-
tally friendly manner and in accord-
ance with health and safety regu-
lations considering the
interaction
between human, environment and
telecommunications. Through these
reports we also aim at the efficient
planning of our base stations’ oper-
ation times.
Number of base station sites with risk assessments completed
2018
2019
2020
Short-term
goal
Mid-term
goal
Long-term
goal
6,870
8,832
10,281
10,800
14,800
28,000
Number of processes improved as a result of risk
assessments at base station sites
2018
2019
2020
Short-term
goal
Mid-term
goal
Long-term
goal
11,859
12,283
12,873
14,000
16,000
23,200
Towers
Global Tower, the leading tower com-
pany in Turkey and one of our sub-
sidiaries, operates in four countries.
Providing services to telecom opera-
tors, radio-TV broadcasters, internet
service providers, energy companies
and public institutions in the fields of
tower rental, tower build-and-sell,
tower maintenance and contract
management, Global Tower has also
started to provide its customers sat-
ellite communication services with
end-to-end solution concepts. Glob-
al Tower provides closed-circuit sat-
ellite services at over two thousand
points over its own infrastructure with
geographic redundancy, and aims to
increase its product range and ser-
vice diversity by following satellite
sector trends.
Global Tower has a portfolio of 10,913
towers as of the end of 2020 and the
portfolio distribution is as follows;
Turkey: 8,789 (owned: 4,341, right of
use: 2,256, contract management:
2,192)
Ukraine: 1,175 (owned)
Belarus: 834 (right of use)
TRNC: 115 (right of use)
Global Tower closely monitors the
transformation process of the tele-
communications infrastructure sector
from tower management to infra-
structure management
throughout
the world and plans to introduce
new business lines in this sector to
its customers. On the other hand, it
is observed that mobile operators in
our country have a positive stance
on
infrastructure sharing and the
consolidation model pioneered by
Global Tower in parallel with global
developments. With the new regula-
tory arrangements to be made in this
area, a crucial step will be taken in
terms of operational savings and re-
source efficiency.
Integrated infrastructure with
redundant sources
We completed the convergence of
our fixed and mobile transmission in-
frastructure in the transmission aggre-
gation layer. Having implemented this
new design, we optimized investments
through the use of shared network de-
vices for fixed and mobile infrastruc-
ture. Accordingly, we created a trans-
mission network with a shared archi-
tecture for fixed and mobile services.
Other benefits of the new transmis-
sion network, the standards of which
have already been shaped, may be
listed as:
• Ability to position higher capacity
devices in the transmission aggrega-
tion layer
• Creating a backhaul structure to
meet 5G service needs
• Ease of operational management
Our Fixed Mobile Convergence Project
in this field received the Best Network
Transformation Initiative award at the
Asia Communication Awards in 2020.
We are able to access our network
data centers with high redundancy
through our flexible transmission infra-
structure with redundant sources. We
continue our network investments in
our large data centers built in Ankara
and Izmir following the one in Gebze,
Kocaeli. Having opened the Istanbul
Europe data center, we will focus our
network investments in our large data
centers, which we have recently built.
Thus, while increasing investment ef-
ficiency, we are constantly building a
stronger communication infrastructure
against natural disasters.
Telco cloud
We have virtualized 50% of our mobile
and fixed core network infrastructure
to date. On the back of virtualiza-
tion, we integrated infrastructures for
network applications and achieved
CAPEX and OPEX savings through
horizontal and vertical architectures.
Along with investment savings, we
have been able to deliver services
faster using similar hardware and in-
frastructure for virtualized services
and solutions. In 2020, we completed
our core network infrastructure migra-
tion to virtual infrastructure with re-
spect to mobile internet and HD voice
services over 4.5G. Going forward, we
will be making mobile core network
investments entirely on the Telco cloud
infrastructure.
Network virtualization rate (%)
2018
2019
2020
Short-term
goal
Mid-term
goal
Long-term
goal
18%
41%
51%
51%
58-65%
75%
Central management and orches-
tration are becoming
increasingly
important with greater system diver-
sity and volumes in NFVI (Network
Function Virtualization Infrastructure)
infrastructure. In order to meet the
rising communication needs of our
customers on a timely and seamless
basis, we utilize the MANO (MAN-
agement and Orchestration) solu-
tion, which enables us to manage
core network system life cycles with
a faster and more flexible approach.
Monitoring KPIs related to the archi-
tectural components of the virtual in-
frastructure and the ability to imple-
ment root cause analysis regarding
the relationship between these com-
ponents are crucial in sustaining the
quality of network services offered
to our customers. In this respect, we
have implemented the NFVI Service
Assurance project to manage cus-
tomer experience over virtual infra-
structure more effectively.
Service Operations Center (SOC)
The Service
Operations Center
actively conducts
analysis and carries
out operational
activities 24/7 to keep
infrastructure and
service continuity at
optimal levels.
It is crucial to monitor alarms to iden-
tify potential failures in our network
and take necessary actions regarding
these failures on a timely basis. We
take necessary measures to increase
digitalization and automation levels
in the Service Operations Center to
improve efficiency and minimize po-
tential errors.
We have in large part automated the
processes of monitoring and commu-
nicating network failures for the ac-
cess network in 2020. “ZeroTouch Ac-
cess Network Automation Activities”
leads to operational efficiency in the
SOC unit, as well as proactivity in the
process of managing customer com-
plaints at the Call Center. Having au-
tomated processes for the Regional
Solution Partner (RSP) teams that car-
ry out site operations, we were able
to shorten the response and solution
times of problems, thereby contribut-
ing to customer satisfaction.
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Investing in domestic equipment
We support the technological devel-
opment and digitalization process of
our country participating in initiatives
to develop domestic technologies
and equipment, thereby creating val-
ue for our country. Introducing Turkey
to the latest technologies and inte-
grating them to our infrastructure, we
continue to differentiate our market
position.
SDG 17.16
SDG 9.B
As part of domestic antenna and
4.5G base station development activ-
ities, we provided expert support to
Aselsan and ULAK ranging from the
design phase to field tests. We start-
ed to use the respective equipments
in our network. Moreover, as part of
the process for developing domestic
and national 5G technology, we give
support to ULAK Haberleşme A.Ş. and
HTK
(Communication Technologies
Cluster), which carry out activities in
development and manufacturing. Do-
mestic 5G product development ac-
tivities continue within the scope of
the End-to-End Domestic and Nation-
al Communication Network (UUYM5G)
Project. As Turkcell, we participate in
the UUYM5G Project with a large and
organized project team, and contrib-
ute to the project by sharing our ex-
pertise in 5G as well as providing ac-
cess to our laboratory and test equip-
ment facilities. The product groups,
which are developed as part of the
project, include 5G New Radio, Core
Network, OSS, NFV, and Radiolink.
Actively engaging in these projects,
we provide the maximum support to
domestic and national development
activities in Turkey. As a member of
the Turkey Cyber Security Cluster, we
contribute to the development of a
domestic cyber security ecosystem,
and increase awareness and cooper-
ation in this area by bringing togeth-
er the public and private sectors and
academic institutions.
broadband access to households at
speeds of up to 10 Gbps via globally
accepted G-PON/XGS-PON technol-
ogy. This value is an upper limit and
may vary depending on variables
such as tariff type, fiber internet us-
age density, and the maximum speed
the modem can support. While the
average fixed internet speed in Tur-
key is around 28 Mbit, 90% of Turk-
cell customers prefer offerings with
speeds of over 35 Mbit.
In 2020, we introduced our new fib-
er customers to Wi-Fi 6 technology,
enabling them to experience fib-
er speed at home more effectively.
Through this technology we provide
up to 40% speed improvement and
much better home coverage. We
continue
technologies
that meet increasing demand from
our customers in the pandemic envi-
ronment, particularly for remote edu-
cation and remote work.
to develop
As we continue to expand our ser-
vices, we also focus on solutions that
meet the needs of our corporate
customers. We became the first op-
erator to offer the SD-WAN service to
customers. We provided security and
access services simultaneously on a
single platform. We created solutions
to reduce increasing costs, while in-
creasing production capacities.
Moreover, as part of managed ser-
vices, we can address the changing
needs of our corporate and whole-
sale customers via services such as
Enterprise Wi-Fi. We continue to offer
new technologies in the Wi-Fi field
such as SMS integration, logging, and
Wi-Fi 6.
The new generation
Converged Transport
Network architecture,
developed by
Turkcell engineers in
accordance with our
customers’ needs,
enables us to manage
data traffic in mobile
and fixed networks
from a single channel.
In this regard, our customers continue
to receive a high quality and fast ser-
vice even during periods of heavy us-
age as has been the case during the
pandemic period. Converged Trans-
port Network architecture, which is
part of the preparation process for
the 5G network, enables the use of
technologies to be introduced with
5G technology.
Strong fiber infrastructure
As the Company that introduced Tur-
key to fiber internet at the speed of
light, we provide fast, high quality
and inclusive services to our custom-
ers, and facilitate everyone’s access
to information and the internet. As
Turkcell, we brought fiber infrastruc-
ture to all 81 cities of Turkey. We are
also able to provide corporate and
wholesale services in every city of
Turkey. We work relentlessly to deliv-
er Turkcell quality everywhere.
SDG 11.A
We provide a fiber internet service to
households in 23 cities, and continue
to expand our coverage. We continue
to invest during the pandemic peri-
od. And we develop our fiber internet
infrastructure, higher speed internet
tariffs and new technological solu-
tions. As Turkcell, we provide fiber
While we continue to expand
our fiber infrastructure, we also
offer household internet servi-
ce over our mobile network
with our Superbox solution,
which was developed to bring
Turkcell quality to locations
without fiber access and offer
high quality internet service at
fiber speed to customers. The
internet usage has risen signi-
ficantly particularly during the
pandemic environment with
the use of remote education
and remote working practices
and with more time spent at
home. The demand for Super-
box service, which provides
same day installation oppor-
tunity to customers, doubled
in the first week of April, and
268 thousand net subscribers
were registered in 2020.
Superbox
was deemed
worthy of 3
different awards:
International
Business Awards,
Effie Awards and
GTI Awards.
SDG 9.B
Strong spectrum
With the frequency resources that it
owns, Turkcell has the largest licensed
spectrum that can be used in mobile
communications services
in Turkey.
Having 34% and 68% more spectrum
resources compared to other opera-
tors in the market, respectively, Turkcell
leverages this muscle to provide higher
quality services to its customers. Fur-
thermore, the technologies used in the
telecom sector are also transforming
via rapid technological developments.
We establish our spectrum assets in a
technology neutral approach to easily
adapt to technological developments
and leverage the large cost of infra-
structure investments and long service
lifecycle to the maximum extent pos-
sible.
Leveraging our rich
frequency resources,
we aim to maintain
the high service
quality of our 4.5G
service, as confirmed
with the maximum
1.4 Gbps speed* that
we offer, with 5G
technology also, when
introduced in the
upcoming periods.
We represented our country in
the international arena via the 5G
test project that we successfully
conducted in NGMN (Next Gene-
ration Mobile Networks Alliance),
the members of which consist
of operators serving over 60% of
mobile phone users over the wor-
ld with more than 200 networks.
As part of the 5G field tests, we
have demonstrated that 5.5 Gbps
cell capacities can be reached in
downloads by using Multi-User
MIMO
technology.
You can access the technical re-
port of the project via the link.
(MU-MIMO)
Refarming
As part of the project, we aim to
increase the spectrum resourc-
es allocated to 4.5G technology
due to increasing 4.5G data traf-
fic. We will plan and implement
activities in relation to frequency
transformation and
inter-tech-
nology refarming that will enable
spectrum efficiency. The resource
allocated to 4.5G technology has
been increased significantly as
part of city-based implementa-
tions, prioritizing metropolitan cit-
ies. In this regard, we created ad-
ditional network capacity to meet
increasing data usage particularly
during the pandemic, while in-
creasing customer experience.
You may find detailed information on 5G trends that lead to
changes and developments in the telecom sector and many
other business areas in the trends section.
* This value is an upper limit and represents theoretical peak values. The speed that the customer can
receive may vary depending on the maximum speed that the terminal can support, its location and
distance from the base station, the configuration of the base station, the instant traffic density in the
network and the number of subscribers currently receiving service from the field.
https://www.ngmn.org/technical-documents.html
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High speed, high quality and
inclusive services; Access to
information and internet for
everyone
We aim to provide faster,
more
inclusive and higher
quality services to our cus-
tomers through investing in
and improving our networks
and
infrastructure. We aim
to maintain our high network
availability via data accessi-
bility rate of 99.96% calculated
over traffic loss in our mobile
network, and our low inter-
ruption rate of 0.3% in mobile
voice calls.
We serve our customers with
innovative solutions such as
Superbox, and aim to provide
access to information and the
internet for everyone.
As part of our Portable So-
lar Field project, we have re-
duced our carbon emissions
by generating 46 MWh of
electricity from 5 solar panels
that we added to our portfolio
in 2020, and 5 portable solar
fields established in 2019.
Meanwhile, we increased our
service coverage
seasonal
by offering the Portable Solar
Field solution in Bodrum Gök-
ova Kissebükü, Alanya Fakır-
calı Plateau, Beytabı Plateau
in Ordu, Alancık Plateau in
Giresun, Artvin Borçka Beyazsu
Plateau, and one of the pla-
teaus of Karçal Mountain at an
altitude of 3,415 meters.
SDG 9.1, 9.4, 9.C
International sale and wholesale
We lead the transformation of the
telecommunications sector in Tur-
key and support its development
through the business partnerships
we establish with international
and national operators in inter-
national roaming, interconnection,
wholesale voice, wholesale data,
tower and digital services.
Turkey, the main internet route
We have become the most im-
portant capacity and
internet
provider for many neighboring
countries through our activities
conducted since 2008 as part of
our vision of transforming the Silk
Road into the Fiber Road, and our
core strategy of positioning Tur-
key as the primary internet route,
with Istanbul becoming a regional
internet hub.
Through collaborations with lead-
ing global operators, we have
served as a bridge providing
wholesale customers with un-
interrupted access from East to
West, at the speed of light.
Istanbul, the traffic exchange
hub of the region
As part of our wholesale data
services, we have increased our
international carrying capacity to
over 10 Tbps. We have cooperat-
ed with the world’s largest global
traffic exchange platforms and
played a major role in their de-
cision to enter the Turkish market.
Thus, we have taken another cru-
cial step in transforming Istanbul
into the traffic exchange hub of
the region. We have also played
a significant role in encouraging
content providers to offer their
services from Istanbul.
Digital export
We strengthened our digital ex-
port move through our cooper-
ation with Digicel Group in the
fourth quarter of 2020, which ini-
tially began with our cooperation
with Moldovan operator Moldcell
in 2017 and with Albanian opera-
tor ALBtelecom in 2019. Operating
in the Caribbean, Central Ameri-
ca and Pacific regions, Digicel, in
partnership with Lifecell Ventures,
a 100% Turkcell subsidiary, has
offered life and communication
platform BiP, TV platform TV+,
lifebox and Fast Login to its cus-
tomers in 32 countries. We will
continue to expand our digital
service and technology solutions
by establishing strong collabora-
tions worldwide.
Data centers
As Turkey’s largest data center op-
erator, we build technologically ad-
vanced data centers in accordance
with our vision that Turkey’s data
should remain in Turkey. We provide
24/7 remote data center manage-
ment services to over 1,600 custom-
ers including Turkey’s largest corpo-
rations. We enable our customers to
access systems independent of loca-
tion and continue to work from home,
which has become increasingly im-
portant, particularly in the pandemic
environment. Meanwhile, expert Turk-
cell engineers provide remote assis-
tance and solve problems quickly in
extraordinary circumstances.
Offering superior
cyber security
standards at our
data centers and
supporting domestic
technologies, we
also create value as
part of our activities
geared at our cyber
security and privacy
material topic.
Our Ankara data center, the largest in
Turkey with 12 thousand m2 of white
space, plus our Izmir and Gebze data
centers have been built with high
earthquake resistance systems and
have systems rooms that can with-
stand fire for 120 minutes. Our data
centers also pursue environmental-
ly friendly practices. Roof type solar
panels are installed at the Ankara
Data Center to produce approximate-
ly 500 thousand kWh of electricity
annually and meet usage needs. With
our LEED (Leadership in Energy and
Environmental Design) Gold certified
data centers, we set a pioneering ex-
ample not only in terms of the tech-
nology itself, but also of our impact
on the environment.
SDG 9.1, 9.4
SDG 7.2
SDG 13.1
Our Ankara data
center was awarded
the Operational
Sustainability Gold
certificate, valid
for 3 years, by the
Uptime Institute, which
inspects data centers
at the international
level.
We also attach utmost importance
to the use of domestically manufac-
tured products in the building process
of our data centers. We continue our
efforts to increase the rate of domes-
tic products used in the data centers
that we build. Accordingly, the ratio of
domestic products used in the Gebze
Data Center, which opened in 2016,
was 35%, while that of the Ankara
Data Center, which opened in 2019,
had increased to 65%.
Data center domestic product usage rate
Gebze
Data Center
35%
İzmir
Data Center
50%
Ankara
Data Center
65%
The interaction of
our manufactured
capital with our other
capitals
Our manufactured
capital provides
technical infrastructure,
operability and speed
for all our services and
products. Although
our infrastructure and
data centers create
negative value due to
energy consumption
via our natural capital,
we actively conduct
efficiency and saving
activities to reduce
such impact. We pay
utmost attention to
public health via our
ERM practices at our
base stations, which
are much stricter
than stipulated by
operative regulations
and standards,
thereby contributing
to our social values
and relationships.
We strengthen our
intellectual capital
with the solutions we
create as a result of
our R&D activities. We
also strengthen our
financial assets with
the economic value
we create.
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Manufactured capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
Intellectual
capital
164
Innovation and entrepreneurship
167
Digital services and solutions
173
Digital business services (DBS)
177
Brand and responsibility
162
Intellectual capital
Intellectual capital
Inputs
Outputs
Value created
Patents and R&D activities
• University and start-up collaborations:
Our facilitating role in private sector collaborations
• National and international supported projects:
Active participation in R&D programs
• Intellectual and industrial property rights:
Our Intellectual and industrial rights management
• Technical and academic publications
Entrepreneurship ecosystem, start-up
and university collaborations
• Techno-park visits: Our close relations with
entrepreneurship ecosystem
• Beehive: Our crowd funding platform
• Corporate entrepreneurship programs:
Our transformation programs to corporate entrepreneurs
Services and applications we developed
• Our indivudal and corporate digital products and services:
Digital services and digital business services
• Techfin: Our technology ecosystem for financial services
• Developing artificial intelligence products internally and
externally at Turkcell: AI technologies we have developed
AI and blockchain applications
• AI Principles: Our AI approach
• AI based products and services:
Services we offer on the AI platform
• Blockchain applications: Our Blockchain solutions
Being a strong brand: Strong brand in its sector
Cyber security services
• MSS Managed security services: Customized security services
• Cyber Defence Center: Cyber security applications
• Offensive security: Security test and assessments
Company policies
1,080
R&D employees
10incubator
collaborations
Outputs
26%
digital services
standalone
revenue growth
140 billion
messages sent
via BiP
40
thousand
Chatbot users
557patent
applications
9
hospitals provided
with technological
infrastructure
Improving the innovation and
entrepreneurship ecosystem through
Turkcell experience
• Adding innovative perspectives to our
current solutions through university and
start-up collaborations
• Contribution to domestic technology
development
Being an operator at the global scale
through a digital operator vision
Making life easier by developing
inclusive and value creating products
and services
• Contribution to Turkey’s digital
transformation and national economy
through TOGG project
• Creating value-add through services using
big data analytics
Understanding the customer better
through data analytics competence
Reducing cyber security risks, meeting
the cyber security needs of customers
Ensuring ethical and equal business
processes
Value created through
open source coding
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Superior digital services
and innovation
customers. We offer our products to
the right customer at the right time
and the right price, leveraging both
our strong bond with them and our
advanced analytical skills, which
rank among our core competencies.
On the back of our big data analytics
applications, we are able to provide
customized offers to more than 35
million customers.
Innovation and entrepreneurship
Through our subsidiary Turkcell Tech-
nology, we conduct our activities as
one of the largest R&D organizations,
with over 1,000 R&D employees as of
2020. We continue to offer innovative
solutions in national and international
markets through activities geared at
the development of new technolo-
gies. With the experience accumulat-
ed throughout the transformation of
Turkcell from a technology-oriented
network provider to a service-orient-
ed experience provider, we carry out
joint R&D programs and issue aca-
demic publications with universities,
and engage in startup collaborations
with techno park companies. Moreo-
ver, we participate in nationally and
internationally supported projects,
contribute to technical publications,
and conduct training and conference
that enable knowledge
activities
transfer.
SDG 9.4
COVID-19 note
We use our intellectual capital
to provide timely and effecti-
ve responses to the COVID-19
pandemic, which has signi-
ficantly impacted key areas
such as education, social life,
and the economy. During the
curfews, we implemented the
“Getir Turkcell’le” project over
Paycell infrastructure to help
our customers aged 65 and
above meet their needs. As
part of this cooperation, the-
se customers, who called the
Paycell call center to place
orders, could easily make the-
ir payments by reflecting the
cost to their telco bill over Pay-
cell infrastructure. Meanwhile,
students, who have continued
remote education from home
during this period, could follow
their lessons on our digital tele-
vision platform TV+. As part of
the fight against the pandemic,
a 24/7 information channel ser-
vice was offered to BiP users,
regardless of their operators.
We aim to steer the
future with our 1,080
R&D employees, who
have adopted the
principle of integrating
our value-creating and
innovative approach to
our corporate culture
and stakeholders, in step
with our activities aimed
at “developing and
improving technology”.
We believe that an innovative busi-
ness culture based on strong per-
formance in systems, processes and
technology is essential to achieve
the most efficient and effective re-
sults from our strategic initiatives
and business model. Leveraging our
intellectual capital in the competitive
markets we operate in allows us to
implement and develop our strategy
in the most effective way. In this re-
spect, while enriching the experience
of our customers in their digitalization
journey, we aim to create value for
all our stakeholders with a focus on
digital transformation.
Our intellectual capital touches var-
ious fields such as innovation, entre-
preneurship, brand power, responsi-
bility, products and services, which
reflect Turkcell’s unique expertise
and knowledge, and is one of the
driving forces of sustainable growth
that differentiates Turkcell. Leverag-
ing our superior digital competencies
and analytical capabilities, we uti-
lize new technological developments
such as IoT, artificial intelligence and
blockchain to improve our products
and services. Thanks to our services
developed and improved by Turkcell
engineers, we produce solutions that
meet the needs and demands of our
We gather the innovative products
and services developed through our
engineering activities at the Turkcell
Technology R&D center under the fol-
lowing groups:
Roaming solutions, big data
processing, business intelligen-
ce applications, smart cloud
platform and solutions develo-
ped on platform, location-ba-
sed services and platforms, ge-
ographic information systems,
customer
relations manage-
ment and solutions, network
management solutions, new
generation value added servi-
ces, mobile financial systems,
music and entertainment ser-
vices,
IPTV services, mobile
marketing solutions, Internet of
Things (IoT), AR/VR, 5G infrast-
ructures, mobile communica-
tion solutions, campaign ma-
nagement systems, smart SIM
card solutions, digital identity
technologies, developments in
image & video processing with
artificial intelligence, text and
natural language analysis (NLP),
recommendation engines, vo-
ice analytics, robot assistants,
robotic process automation,
mobile analytical platforms,
artificial intelligence in health,
business applications solutions,
learning and education app-
lications solutions, e-mail and
search engine solutions, digital
broadcast solutions, CDN (Con-
tent Delivery Network) Soluti-
ons, Over-the-Top (OTT) and
blockchain solutions.
In our patent
application processes,
we continue to
exchange our
experience with
universities, startups,
SMEs, business
partners and the
entire ecosystem.
Number of R&D employees
894 people
2018
956 people
2019
1,080 people
2020
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Reflecting Turkcell’s strategy of ex-
panding the presence and scope of
its products and services in interna-
tional markets, we aim to develop
our new digital and ICT services on
a global scale based on the latest
technologies and market needs, and
grow in those regions where we offer
our services.
By preparing our patent applications
for the products and services that we
develop, and reviewing the patents
applied and registered by technology
companies in the field in which we
operate, we obtain information on
competition and trends, and identify
those areas where we can differenti-
ate ourselves.
Number of patent registrations*
Number of patent applications
*Presented as cumulative number.
2018
369
453
2019
521
511
2020
700+
557
Turkcell Teknoloji has a leading position
in its sector in Turkey with 2,674 national
patent applications, 167 international patent
applications and over 700 registered patents
completed since 2008.
We support valuation activities with
respect to registered utility models
and patents within Turkcell Group. As
part of these activities, we continue
to gain experience on the calculation
methods of cost efficiencies created
by technical solutions that are subje-
ct to patents. As a result of the patent
valuation activities for our solutions
such as Messaging Applications and
International Fraud Prevention Sys-
tems, we continue to benefit from the
corporate tax advantages provided
by the Ministry of Finance conside-
ring the benefit created by patented
products.
As part of our responsibility as a bo-
ard member of ITEA3 (International
Technology Education Association)
and Celtic Next cluster programs
within EUREKA (The European Audi-
ovisual Observatory), we enable the
firms in our ecosystem and SMEs to
access
In
projects that we participate in under
the EUREKA umbrella, funding support
is assessed by competent authorities,
international platforms.
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Intellectual capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
166
Intellectual capital
TÜBİTAK-TEYDEB (the Scientific and
Technological Research Council of
Turkey – Directorate of Technology
and Innovation Support Programs).
In recent years, we have successfully
increased the number of project app-
lications as part of the Horizon 2020
main program and subprogram that
derive direct and large grant support
from the European Commission, on
platforms offering a more competiti-
ve and selective environment for pro-
posing project ideas.
We continue to seek university and
startup collaboration opportunities
in order to support startups in accor-
dance with the guidance of the Mi-
nistry of Science, Industry and Tech-
nology, and to expand Turkey’s R&D
ecosystem so as to increase the we-
ight of domestic products and servi-
ces. We develop products with star-
tup companies, provide technological
support, and increase their commu-
nication and recognition by including
them in the European Union projects
that we are involved in.
As an example, we continue to work
with a techno park company to
transfer real-time water analysis over
NB-IoT based communication modu-
les as of 2020. This project enables
remote analysis of drinking water re-
sources in the event of a disaster or
refugee influx. By integrating our 5G
competencies to the hardware pro-
duction capabilities of the startup
company, we work on an innovative
national product.
167
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TÜBİTAK supported project applications
HORIZON project applications
University collaborations supported by TÜBİTAK
Incubator collaborations
2018
2019
2020
11
8
7
10
9
15
2018
2019
2020
4
8
4
9
5
10
Beehive – Turkey’s
crowd funding platform
The Beehive platform, enabling en-
trepreneurs to receive necessary re-
sources from society to implement
their technology and innovation-ori-
ented projects, provides various ad-
vantages in terms of crowd funding.
Beehive enables project owners to
secure the financial resources they
need to launch their products via the
support of individuals across socie-
ty, in large and small amounts, rather
than relying on a specific person or
institution. Over 7 thousand project
applications have been submitted
to Beehive to date. 40 out of 73
selected projects have successful-
ly completed their campaigns with
funds reaching around TRY7.5 mil-
lion. Initiatives that have successfully
attracted funds and started mass
production have already begun to
make a difference in the world.
Value Created through Use
of Open-Source Coding
As Turkcell, the use of open-
source software is a signif-
icant topic for us both from a
user and developer perspec-
tive. Open-source software is
utilized to solve various prob-
lems in software architecture.
We prefer using open-source
software as the building block
of high-volume
infrastructure
applications such as ONEDESK,
ULTIA, ONENT, YAP, PARS, which
have been developed under the
Turkcell GENS directorate. In this
respect, in addition to creating
value in terms of license man-
agement and cost initiatives,
we support the future of the
software world contributing to
the development of high-quali-
ty secure software without any
provider restrictions.
Our human capital lies at the heart
of our R&D and innovation strategies.
In this respect, we provide academic
development opportunities to Turkcell
Technology researchers. Our post-
graduate and doctorate programs,
designed to improve the technical
knowledge base of our employees
in accordance with the qualifications
required by our sector, are ongoing
since 2014 with a rapidly growing
curriculum.
In the meantime, in
accordance with
our vision of leading
the production of
new technologies,
we contributed to
the expansion of
technology studies
by issuing 23
academic and 95
technical publications
on national and
international platforms
in 2020.
Digital services and solutions
While our digital services and solu-
tions offer our users a richer value
proposition, we also work on devel-
oping our solutions to cover all user
needs. Leveraging the power of tech-
nology and communication, we have
maintained our tradition over the
past 27 years of facilitating people’s
lives and achieving firsts, by conduct-
ing projects befitting the title of the
world’s first digital operator. We not
only offer communication services,
but also produce and develop digital
services. The telecommunication sec-
tor is no longer limited to voice and
SMS services. Based on this strategy,
we have developed numerous digital
services domestically thanks to the
more than 1,000 engineers working
for our Company. Establishing sep-
arate companies for some of these
services, we have taken an important
step towards their global competitive
positioning. BiP, lifebox, TV + and fizy
brands, which aim to stand out in the
global competitive arena, are now
positioned as separate companies.
As part of this structure, these brands
conduct their activities faster, strong-
er, and with greater focus within their
own organizational structures.
In 2020, we increased
our digital services
standalone revenues
by 26%.
We continue to lead the digital trans-
formation demanded by society
through dozens of services includ-
ing video conferencing, e-mail ser-
vices, instant messaging, TV, digital
broadcasting, cloud storage, digital
authentication and music platform,
which have been developed by Turk-
ish engineers and software develop-
ers. To make this digital transforma-
tion accessible, we use our advanced
analytical capabilities, and position
the right service for the right cus-
tomer, thereby enhancing customer
experience. Furthermore, develop-
ing these services and solutions, we
aim to contribute to the production
of domestic technologies, and to
support the national economy with
self-sufficient technology solutions.
Meanwhile, we design global brands
and technologies, which we digitally
export to the world. We consider it
our primary goal to make a positive
contribution to the national econo-
my and reputation of our country by
creating economic value through na-
tional security, data ownership, and
by making use of our own data.
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Intellectual capital
Communication without Boundaries: BiP
BiP, which is an all-access applica-
tion, offers a seamless communica-
tion service via secure messaging,
calls and group video calls. BiP dif-
ferentiates itself from global players
with features such as lost messag-
ing, web calling, emergency button,
fast and secure money transfer as if
sending a message, group video-call,
video-conference solution and the
option of using two phone numbers
on a single device, called Second
Number at BiP.
In 2020, the number of group video
calls made over BiP increased ap-
proximately fivefold compared to
2019, from 7.1 million to 34.1 million.
Meanwhile, data usage doubled from
3.9 million GB to 8 million GB. With
BiP, we achieved a 16% growth in ap-
p2app calls in 2020.
Through the BiP Meet platform, we
enable users to communicate with
anywhere in the world anytime over
a strong infrastructure with a user
friendly interface, while keeping all
respective data in Turkey.
You may access the products,
services and detailed
information we offer within
BiP at www.bip.com
You can access BiP Meet,
Turkey’s fast and secure
remote meeting solution,
on www.bipmeet.com
Number of BiP active users (million)
Total number of messages sent via BiP (billion)
2018
2019
2020
11
34
8.9
90
9.6
140
Supporting the fight against COVID-19 through BiP
BiP users, independent of operator, can take an Online COVID-19 test
from the Ministry of Health channel in the Discover section, and access
the ALO 184 Ministry of Health Contact Center Information Line free
of charge in suspicious cases. Users following the channel can also
instantly access current news on the pandemic announced by the Min-
istry of Health, the COVID-19 Live Map showing the latest updates and
general announcements.
The first company-specific communication platform: a-ileti
As part of our customized corporate solutions, over 8 thousand Asel-
san employees conduct all of their communications securely thanks to
the a-ileti platform, exclusively designed and developed for Aselsan by
Turkcell engineers.
BiP Emergency Button
The “Request Help” feature on the Emergency Button of BiP, developed
by Turkcell engineers, now also works on Bluetooth technology when
needed, saving lives in emergencies. The number of registered emer-
gency contacts, who can be reached in the event of natural disasters
such as earthquakes has exceeded 2 million. Users are able to inform
their emergency contacts, registered to the platform in advance, on
whether they are safe or need help, with a single button via the emer-
gency feature.
The best thing that can happen to a
phone: lifebox
lifebox, which allows users to securely
store and share photos, videos, music
and documents, offers a secure and
easy platform to keep memories,
while also offering a social experi-
ence. Our personal smart cloud stor-
age service lifebox, on which billions
of images have been uploaded to
date, appeals to users not only in Tur-
key, but all around the world.
With functions beyond storage, life-
box stands out for its feature of auto-
matically creating stories among the
photos it chooses, as well as recog-
nizing faces and objects, while also
ensuring that contact information is
not lost in any adverse situation via
secure contacts backup. Documents
archived in various categories may
be securely accessed by using fin-
gerprint, face recognition or pass-
word. Moreover, images in lifebox
can be categorized separately based
on person, object, date, and location
criteria.
With lifebox Transfer, we aim to offer
a convenient and free-of-charge ex-
perience of fast file sharing without
need for membership, while storing
all respective data in Turkey.
You may access the products,
services, and detailed
information we offer within
the scope of lifebox on
www.mylifebox.com and
www.lifeboxtransfer.com.
Number of files backed-up via lifebox (billion)
Number of users who backed-up their contacts via
lifebox (million)
Number of users who uploaded file to lifebox
(million)
2018
2019
2020
3.5
1.1
6.4
2.7
8.1
3.3
3.2
4.3
5.4
TV joy is everywhere: TV+
TV+, both a first and unique in terms
of the TV watching experience in Tur-
key, is a ground-breaking television
platform changing the dynamics of
the TV world. TV+ continues to play
an important role in the digitalization
of user experience by enabling its
users to access series, movies, docu-
mentaries, sports, children’s programs
and other TV content, whenever and
wherever they like. In addition to the
rich content of TV+ and its superior
technical features that provide ease
of use, users can watch television
any-time and anywhere via TV+
Ready, and benefit from the oper-
ator-independent TV+ service. TV+,
which was developed by Turkcell en-
gineers, can be watched on all plat-
forms. Even non-smart televisions can
be converted to a smart TV thanks
to TV+ Ready introduced this year.
Users of TV+ can access the world’s
leading football leagues such as the
Bundesliga and Premier League, and
other sports content such as NBA and
Formula 1, as well as documentaries
and thousands of applications.
You can find the products,
services, and detailed
information we offer within
TV+ on www.tvplus.com.tr.
Number of IPTV users (thousand)
2018
2019
2020
613
720
871
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TURKCELL INTEGRATED ANNUAL REPORT 2020
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Turkey’s digital music platform: fizy
fizy, one of the most popular and pre-
ferred music platforms in Turkey, now
delivers a more customized music
experience to its customers with rec-
ommendation lists along with a rich-
er content archive. In addition to en-
joying an ad-free music experience
and high-quality sound, fizy Premium
users can view song lyrics and listen
to content offline. As a differentiation
point from competing applications,
users can benefit from advantageous
discount offers thanks to brand col-
laborations and customer campaigns
exclusive to fizy. In 2020, as part of a
campaign exclusive to students, they
benefited from fizy’s standard Premi-
um membership.
In addition to our 4
brands, for which
separate companies
were established,
Yaani, YaaniMail
and Dergilik have
also been among
our users’ favorite
applications.
You may access the products,
services, and detailed
information we offer over
fizy on www.fizy.com.
Number of fizy contents (million)
2018
2019
2020
28.8
32.6
33.5
Yaani stands out with its features of
understanding the Turkish language
very well, showing the most appro-
priate results for the searched con-
tent and providing Turkcell subscrib-
ers with a search experience of rich
data sources. It makes a difference
by showing the closest location to
the user in location-based searches.
Number of total Yaani downloads (million)
7.6
9.7
11.6
2018
2019
2020
In accordance with our vision of of-
fering domestic digital services, we
introduced our customers to anoth-
er crucial service with the launch of
domestic e-mail platform YaaniMail.
YaaniMail, launched to serve both
corporate and individual clients, was
developed by Turkcell’s R&D engi-
neers. The platform, serving with
the “@yaani.com” extension, offers a
strong domestic alternative to glob-
al competitors. The information and
data of YaaniMail users are stored at
Turkcell Data Centers.
YaaniMail reached
the 1 million account
level in its first year
thanks to vibrant user
interest.
Dergilik, where hundreds of newspa-
pers and magazines published in Tur-
key are delivered digitally on a single
platform, enriches the magazine and
newspaper reading experience, while
facilitating the user experience of ac-
cessing digital publications. Further-
more, certain Dergilik features are
firsts in the sector, such as personal
articles, offline reading, automatic
downloading of the current issue of
a preferred magazine with a single
instruction, current issue notification
of magazines in the favorites list,
and reading hundreds of magazines
for the price of a single one. Dergi-
lik continues to provide its users a
unique reading experience through
recently launched audio articles, and
personalized magazine, newspaper
and article offers.
Environmentally friendly and
practical solutions through
digitalization: Digital signature
at home
On the back of the new solution
that we developed, customers
wishing to subscribe to our fib-
er, DSL, Superbox and TV+ of-
ferings will be able to complete
their subscription using a digi-
tal signature. This solution ena-
bles service teams to complete
product set up and configura-
tion 30% faster. Meanwhile, this
will also lead to 11 million pages
of documents being digitalized
annually, thereby protecting the
environment.
1.5 million
households are
expected to use
digital signatures
annually across
Turkey.
Smart legal documentation
automation
In addition to the solutions we
offer to customers, we also de-
velop a smart documentation
solution for our own legal func-
tion, the paper usage of which
is extreme. As part of this pro-
ject, we aim to reduce manual
transactions by digitizing the
responses to legal document
requests from the authorities,
so as to save on paper usage.
Thus, we expect to achieve ef-
ficiencies through prevention of
errors while conducting tasks,
and the automation of manu-
ally implemented assignments
and query functions via robotic
processes.
Better customer experience through
artificial intelligencei
We enrich and develop our products
and services making use of artificial
intelligence. By leveraging artificial in-
telligence to develop solutions for our
applications and customer services
channels, we create more efficient
and customized services. In 2020, we
identified 7 principles to comply with
in utilizing the powerful tool of artifi-
cial intelligence as part of our oper-
ations, including responsible content
management. We are committed to
responsible use of artificial intelli-
gence tools within the scope of these
principles. We were the first company
in Turkey to disclose such principles.
Furthermore, as part of our Human
Rights Policy disclosed at the begin-
ning of 2021, we aim to utilize tech-
nologies, and in particular artificial
intelligence, paying utmost attention
to human dignity and fundamental
rights and freedoms, in support of
SDGs. You may find more information
on the artificial intelligence principles
on the “digital responsibility” page of
our website.
Our artificial intelligence team carries
out predictive modelling and seg-
mentation activities to create target
audiences for business units. More-
over, they provide post-analysis and
insights for Turkcell products, servic-
es, tariffs, and campaigns. Support-
ing business units via analytical trend
models so as to offer tariffs, products
and services to the right customers,
they contribute to revenue growth of
our Company, and play a key role in
raising customer satisfaction..
Chatbot
We integrated our artificial intelli-
gence-based chatbot, developed in-
ternally by Turkcell engineers, to our
Digital Operator application, while the
integration process continues on other
digital products. We follow a profes-
sional approach to chatbot develop-
ment processes, thereby managing all
steps including needs analysis, data
preparation, model training, dialogue
design, and middle layer development
internally. Making use of the quality
control screens and the quality con-
trol process, which we developed to
sustain and continuously improve the
product’s quality, we aim to enhance
the chatbot experience of our cus-
tomers each day.
In 2020, the share of
customers, whose
requests were met over
chatbot without the
need to connect to a
customer representative,
was 93.3%. Meanwhile,
the total number
of customers using
chatbot reached 40
thousand.
171
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Intellectual capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
172
Intellectual capital
Voice analytics – Turkcell AI voice
As Turkcell engineers, we have devel-
oped our own artificial intelligence
voice to enrich customer experience
of our products, services, and pro-
cesses. In the training of our artificial
intelligence-based
text-to-speech
models, we used 40 hours of audio
data voiced by vocal artist Şenay
Gürler in a professional sound studio
over months of intense work. We are
also actively working to improve our
models and gain new competencies
with new readings from Şenay Gürler.
We have integrated our
artificial intelligence
voice into Turkcell’s
digital products Dergilik
and GollerCepte, as
well as into the online
trainings prepared by
our Academy team. Our
artificial intelligence
voice has also been
integrated into the
Global Bilgi call center
system.
TURKCELL INTEGRATED ANNUAL REPORT 2020
FOYA
FOYA is an artificial in-
telligence platform that
provides solutions in the
field of fraud and risk
analysis. Advanced image processing
techniques, OCR (Optical Character
Recognition) and face detection ca-
pabilities allow us to instantly identify
the picture type, detect any informa-
tion inconsistency in the identity, and
check whether the passport picture
is real, and whether the person has
registered a fraudulent transaction
in the past. Thus, it prevents trans-
actions being made using fake iden-
tities. FOYA won 3rd prize at the IDC
DX AWARDS 2020 in the “Digital Trail-
blazer” category.
SIMA – Face analytics
platform
SIMA is an API-based ar-
tificial intelligence plat-
form that provides face
analytics solutions. It contains a rich
portfolio of features including face
recognition, registration, verification,
age, gender, and emotion prediction.
Our SIMA platform is actively used
for personal verification processes in
digital onboarding processes, and in
Paycell and Digital Operator applica-
tions. Face detection and recognition
algorithms were developed by Turk-
cell engineers working on authorized
face images. The most appropriate
combination of deep learning and
machine learning algorithms is used,
with that being the most up-to-date
method.
AI based recommendation engine
We make use of the recommenda-
tion engine infrastructure developed
by Turkcell engineers to
increase
the customer’s personalized user
experience of our applications and
communication channels. Current-
ly, we personalize content such as
suggestions, product similarities and
personalized product lists in fizy, TV+
and Dergilik applications with artifi-
cial intelligence support. Behind the
recommendation engine is a very
powerful and large data infrastruc-
ture, comprising a cluster of servers,
which process over 200 million items
of data per day.
This large volume of
data is processed by
choosing the most
appropriate algorithms
specific to the subject/
problem such as
machine learning,
deep learning, and
collaborative filtering,
and regularly feeds
relevant applications at
integration points.
Cyber security
We carry out activities on the na-
tional and international fronts to
develop measures that help identify
threats, and that reduce and elimi-
nate the effects of possible attacks
and incidents, and to share those
measures with identified bodies. As
part of these activities, we operate
information security management
systems under the supervision of our
senior management that ensure the
security of information in accord-
ance with business requirements,
laws and legal regulations. In 2008,
we became the first telecommuni-
cation operator in Turkey to receive
ISO 27001 Information Security and
Management System certification.
We retain our certification by con-
stantly improving our information
security practices and by being au-
dited annually by independent audi-
tors.
Cyber security plays an important
role both in conducting our inter-
nal activities and in the provision of
products and services to our cus-
tomers. The Turkcell Cyber Security
team has a competent staff of over
130 engineers, and these specialized
experts work tirelessly for the sys-
tems security of both Turkcell and
our customers. Our Cyber Security
Center monitors our customers’ in-
frastructures 24/7, taking measures
against possible threats.
SDG 9.B
Within the scope of digital busi-
ness services, in addition to the
cyber security services we offer to
our corporate customers, we also
develop products for our individ-
ual customers. The digital security
service blocks users from access-
ing malicious addresses to protect
them against cyber threats such as
phishing and malware, informs them
of past password leaks, and warns
them in case of new password sei-
zure attempts via SMS and e-mail.
All mobile customers can use this
service to avoid fraud, or to protect
their device and personal data. Our
digital security service has over 10
thousand active customers.
Digital business services (DBS)
Turkcell Digital Business Services was
established in January 2019 to serve
as the digital transformation part-
ner of Turkcell corporate customers,
leveraging Turkcell’s brand power
of 27 years, its extensive sales force
covering public, strategic, large and
small-scale customers, and its supe-
rior technology infrastructure. Turkcell
digital business services combines
Turkcell’s telecom service provider
strategy with the “Digital Transfor-
mation Business Partner” approach to
corporate customers.
We are developing our
business model through
Turkcell digital business
services to address the
needs of all industries
and to implement
value-adding projects
through horizontal and
vertical solutions in
transportation, finance,
healthcare, education,
logistics, production,
retail and energy and in
similar fields.
We provide end-to-end digital solu-
tions to private sector companies and
public institutions. Thus, we contribute
to the value propositions of Turkey’s
growing digital economy that ena-
bles enterprises to reduce their costs
and grow their revenues.
In accordance with our vision, we
have
implemented approximate-
ly 1,500 tailormade projects to date,
which we continue to manage. As
part of these efforts, we analyze the
needs of customers across every sec-
tor and opt for the appropriate solu-
tion. With our expert project man-
agement team, we deliver several
solutions and services across diverse
fields including fixed access, network,
cyber security, data center and cloud
services, managed services, digital
transformation, IoT, big data, business
applications and so on. We imple-
ment the most effective solution in
accordance with the specific business
processes of our customers. In imple-
menting our projects, we benefit both
from our internal resources, products,
processes and technologies, and the
strength of our business partners in
the ecosystem that we have identi-
fied as the most competent in their
field, managing projects of high value
proposition from end-to-end.
In order to facilitate the digital trans-
formation journey of Turkey’s organ-
izations, we own a strong mobile
network operating on the widest
spectrum, 50 thousand km of end-to-
end fiber infrastructure and 8 world-
class data centers, including 3 new
generation facilities. These together
enable us to provide superior quality
services in support of our customers’
technological transformation. As the
largest data center operator in Tur-
key, we pursue activities towards
building new generation data centers
that are the world’s most advanced
and secure, in accordance with the
vision that “Turkey’s data should re-
main in Turkey.” Our new generation
data centers hold Tier-3 Design and
Operation Sustainability certificates
from international certification institu-
TURKCELL INTEGRATED ANNUAL REPORT 2020
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174
tion, the Uptime Institute. We are the
first data center operator in Turkey
to have received Uptime Operational
Sustainability certification. Our new
generation data centers designed
and built to international standards,
are preferred by global companies,
including finance and energy enter-
prises and global service providers.
At our data center in Ankara/Temelli,
the largest in Turkey, we transformed
a room into a “Public Hall” by physi-
cally isolating it for our public-sector
customers. In order to serve our pub-
lic institutions in accordance with the
Presidency Information and Commu-
nication Security Measures Circular
into force regarding the security of
public data and its transfer to digi-
tal environments, and the guide pub-
lished accordingly, we launched our
Government Cloud service in 2020.
Via Turkcell Cloud services, we po-
sition all information technology in-
frastructure of institutions at Turkcell
Data Centers, thus providing more
flexible infrastructures while reducing
costs. We offer uninterrupted service
experience from fully backed-up in-
frastructures at six separate data
centers located in Istanbul, Ankara,
Izmir and Kocaeli. We continue to
develop our services as the first and
only service provider in Turkey, whose
cloud information security holds ISO
27017 Cloud Information Security Cer-
tification.
We provide consultancy services to
corporations at all levels in the field
of cyber security, another component
in the field of digital transformation.
Our Security Operations Center is a
member of international organiza-
tions such as FIRST and OIC-CERT
having met their membership require-
ments. Thus, it has access to the best
resources for reactive/proactive pro-
tection and countermeasures. Pene-
tration test and vulnerability analysis
services also feature in the cyber se-
curity services portfolio of our center
that carries out security scans of key
institutions. The “Turkcell Bozok Cy-
ber Threat Intelligence Platform” de-
veloped by Turkcell engineers using
100% domestic technology, offers the
advantage of protecting customers,
which receive Turkcell Security Op-
eration Center service against cyber
threats. This platform can also be pro-
vided as a separate service to organ-
izations that request it.
With the Turkcell IoT Platform, we al-
low companies to remotely manage
their devices and machines via the
cloud without incurring infrastructure
investment costs. Our business part-
ners operating in the IoT ecosystem
can develop their solutions on the IoT
Platform and reach Turkcell corporate
customers
through collaborations.
With the energy efficiency scenario,
one of the IoT scenarios, companies
can instantly measure their energy
consumption and transfer the data
into actionable information for deci-
sion-making, while at the same time
making significant energy savings. In
addition to the IoT Platform, we of-
fer institutions solutions with the IoT-
based products we have developed in
many areas such as Akıllı Atık (Smart
Waste), Kopilot, Turkcell Filiz and Turk-
cell Enerjim.
We support our customers’ strate-
gic decision-making processes and
increase their profitability and effi-
ciency through meaningful analyses
based on the dynamic and real data
garnered from our big data services.
Thanks to these services, we continue
to create value for our customers in
many sectors such as retail, shopping
malls, transportation, finance, tourism,
fuel oil and finance.
In an organization’s journey towards
digital
transformation, with Turk-
cell digital business applications we
provide all end-to-end needs from
team and document management
to digitalization of financial process-
es, including employee training man-
agement. We continue to expand
our product portfolio to meet indus-
try-specific needs, while also pro-
viding our customers with business
application services that can be used
jointly, with easy installation and use.
In addition to our value-added servic-
es, we realize digital transformation
We support our
customers’ strategic
decision-making
processes and increase
their profitability and
efficiency through
meaningful analyses
based on the dynamic
and real data garnered
from our big data
services. Thanks to
these services, we
continue to create
value for our customers
in many sectors such as
retail, shopping malls,
transportation, finance,
tourism, fuel oil and
finance.
In 2020, digital business
services put into
service the technology
infrastructure of
Başakşehir City
Hospital, one of the
largest hospitals
in Europe with a
2,682-bed capacity.
In addition, digital
business services
provided and installed
the IT infrastructure
required during the
pandemic period for
the Sancaktepe and
Yeşilköy multipurpose
emergency hospitals,
which both have a
1,008 bed capacity,
and for Tekirdağ City
Hospital, which has a
475-bed capacity. As
Turkcell, the services
we provide support
employment at 9
hospitals.
projects with vertical solutions that
appeal to the needs of each sector.
With our consultants of specific sec-
tor expertise, we analyze our custom-
ers in the ten focus sectors of finance,
health, education, logistics, produc-
tion, retail, energy, tourism, SMEs and
central and local administrations. We
adopt a 360-degree perspective and
reveal the current situation with sec-
tor-based customer scores. Thus, in-
stead of offering a general solution,
we move towards deeper custom-
er-centricity by positioning a solution
set that considers their specific sec-
toral needs.
We continue to conduct projects of
high value proposition in the health
sector, where we have deep expe-
rience. Turkcell digital business ser-
vices is the market leader by num-
ber of hospitals and beds covered in
the public-private sector partnership
market through the city hospitals
projects, which have become the lo-
comotive of success for our national
healthcare sector. Turkey is among
the world’s leading healthcare service
providers, especially in the region. We
continue to provide end-to-end digi-
tal solutions in the health sector with
our current 7 city and 2 field hospi-
tals. We continue to play an impor-
tant role in the digital transformation
of hospitals, especially with our own
Information Management
Hospital
System (HIMS) software, which we
have developed exclusively with Turk-
cell Digital Business Services resourc-
es. In 2020, Digital Business Services
put into service the technology infra-
structure of Başakşehir City Hospital,
one of the largest hospitals in Europe
with a 2,682-bed capacity. In addi-
tion, Digital Business Services provid-
ed and installed the IT infrastructure
required during the pandemic period
for the Sancaktepe and Yeşilköy mul-
tipurpose emergency hospitals, which
both have a 1,008 bed capacity, and
for Tekirdağ City Hospital, which has
a 475-bed capacity. As Turkcell, the
services we provide support employ-
ment at 9 hospitals.
There are three main categories in our
business partnership ecosystem that
we manage end-to-end; our subcon-
tractors, those we develop products/
solutions together with, and our sales
partners. We focus on creating new
sales opportunities for our products,
services, and system integration pro-
jects through our sales partners. In
2020, we launched the “Business Part-
nership Program” for approximate-
ly 150 sales partners in our ecosys-
tem having different competencies.
We continue to grow our ecosystem
working with a win-win approach.
Moreover, through our business part-
nerships with global vendors, we
expand our solution portfolio to our
customers in terms of technical com-
petency and project diversity.
While offering our products and ser-
vices, we make big data meaningful
with artificial intelligence and busi-
ness intelligence systems, thanks to
our advanced analytical capabilities
and technology investments.
As Turkcell, we conduct analytical
studies based on data science fun-
damentals, plus studies in the fields
of artificial intelligence and machine
learning. We closely follow artificial
intelligence
that are
technologies
used effectively across many areas
such as healthcare, transportation,
finance, communication, and urban
and environmental planning. Utilizing
the latest technologies, we develop
solutions focusing primarily on peo-
ple, society, and the environment,
thereby enhancing the customer and
employee experience, and creating
value for our country.
The Turkcell ML (Machine Learning)
platform has been developed to im-
plement appropriate scenario model-
ling with high performance and accu-
racy by leveraging high-volume data
learning competen-
and machine
cies. As part of these activities, over
TRY20 million has been saved to date.
Moreover, having launched the block-
chain-based “Blacklist Between Op-
erators” system, we can share a list
of customers with overdue payments
of over a certain amount. This system,
which is used jointly by all operators,
helps them reduce customer-related
risks through information exchange.
175
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Intellectual capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
176
Intellectual capital
The initiative, formed by
a consortium of 5 major
companies including
Turkcell, carries out its
activities continuously
towards the launch of
Turkey’s own domestic
and electric automobile
brand.
Domestic electric automobile TOGG
will stand out for its feature of inter-
net connection. As part of connectivity
solutions, in addition to features such
as viewing meetings and activating
navigation based on your meeting lo-
cation, it is also possible to continue
listening to a song in the car that was
being enjoyed at home using fizy, a
part of Turkcell’s digital services port-
folio. The vehicle is also scheduled to
have features such as weather fore-
cast, navigation and the synchronizing
of home and car temperature.
You may access more
information about the
transaction volumes and
number of users of Paycell in the
financial capital section.
Turkcell and mobility
In the field of mobility, a rising trend
in the telecom and technology sector
in general, we continue our activities
regarding autonomous vehicles at and
above level 3, leveraging our image
and video processing capabilities.
As part of e-mobility activities, lever-
aging our telecom industry capabili-
ties we installed 3 charging stations of
different brands that have similarities
in terms of charging station manage-
ment for testing purposes. These sta-
tions were integrated with software
solutions in MSP (Mobility Service Pro-
vider), CPO (Charge Point Operator)
and Roaming layers offered by various
companies in the field of e-mobility. In
this respect, station management and
end-user experiences were observed.
As part of the 5G Remote Driving pro-
ject, using artificial intelligence algo-
rithms, we are carrying out activities
to identify whether an autonomous
vehicle is in danger and keep it away
from such situations via remote-con-
trol center over the Turkcell 5G net-
work.
Turkey’s domestic automobile TOGG,
developed by Turkey’s Automobile
Joint Venture Group Inc, was an-
nounced in December 2019, where-
upon its design and roadmap were
revealed.
Proov is a digital identity man-
agement application devel-
oped with blockchain technol-
ogy that enables users to prove
their identity while registering
to institutions and organizations
utilizing data previously stored
in various other
institutions/
organizations. It is based on a
model that enables personal
data privacy to be managed by
blockchain technology. Through
use of cryptographic methods,
the activities of digital identities
cannot be tracked, but are pro-
tected.
RPA
(Robotic Process Automation)
technology is installed, and the re-
spective infrastructure activities are
implemented across Turkcell. Duly, 145
processes have begun to be carried
out using RPA, towards manual pro-
cess automation.
Turkey’s new generation payment
platform: Paycell
Paycell continues to increase its pe-
netration on the back of easy and
secure payment solutions. Paycell
stands out as a technology-oriented
techfin that manages all its processes
with end-to-end automatized systems
over a robust technological infrastru-
cture. Having adopted an agile wor-
king model to differentiate itself within
the rapidly changing dynamics of the
techfin ecosystem, Paycell manages
it business processes more efficiently,
achieving value creation in the offe-
ring of its products and services. This
approach also allows rapid and easy
adoption of new technologies. Paycell
provides value-added data analytic
models not only with respect to its
infrastructure, but also with respect
to analytical solutions so as to pro-
vide better and sustainable services
to consumer segement and business
partners alike.
increase
Brand and responsibility
the capacity and
We
strength of our superior digital ser-
vices by constantly researching the
latest hardware and software trends
and equivalents at the global level.
This allows us to advance the Turk-
cell brand through new features that
facilitate our customers’ lives. In every
field we work in, we strive towards
removing digital barriers and increas-
ing access at every point where we
touch society, and we continue to
support the development of technol-
ogy and communication. We are glad
to note that our products and servic-
es across diverse fields have grown
the Turkcell brand without losing their
technology focus.
We bear the
responsibility of
providing a good
customer experience,
not only via our
employees in direct
contact with our
customers, but also
via the entire Turkcell
Family, who design,
develop, and plan our
products and services
for our customers.
The basis of this understanding that
Turkcell acts on is a responsibility
towards all of our stakeholders in-
cluding customers, employees, sup-
pliers, shareholders, public, dealers,
non-governmental organizations, uni-
versities, and the media. In our policies
implemented in this context, we aim
to transform the power of technology
into benefits for everyone, inclusively
and sustainably, and we work to en-
sure ethical and equitable business
processes across the entire Turkcell
ecosystem. In this context, our policies
that we share publicly are as follows:
Human Rights Policy:
We are committed to fulfilling our
duties by embracing fundamental
rights and freedoms, and to ensuring
compliance with national legislation
on working life and the international
capital markets regulations that we
are bound by.
Anti-Bribery and Corruption Policy:
We view the carrying out of our ac-
tivities fairly, honestly and in accord-
ance with legal and ethical codes a
necessity.
Quality Policy:
We continuously improve our pro-
cesses and implement an effective
quality management system.
Customer Satisfaction Policy:
We solve customer requests with an
open, transparent, swift, and custom-
er-oriented approach.
Information Security Policy:
At Turkcell, we ensure the security of
information in accordance with busi-
ness needs, laws, and legal regula-
tions.
SDG 16.5, 16.6, 16.B
You may access the policies that
we implement to set the highest
standards as Turkey’s leader in
the telecommunication sector on
turkcell.com.tr.
The interaction
of our intellectual
capital with other
capitals
Our intellectual
capital plays a key
role in providing the
required creative
strength for all
other capitals, and
is in turn supported
by the outputs of
other capitals. We
aim to improve our
product and service
quality, and thereby
increase stakeholder
satisfaction by
focusing our R&D
and innovative
activities to respond
to their needs
and expectations.
Meanwhile, on the
back of our brand
approach and sense
of responsibility,
we support
strong corporate
management, and
our social values, and
relationships.
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Our social
Our social
values
and relations
and relations
and relations
182
Turkcell social values and relations management
185
Our brand
186
Strong sales channels and our services
189
Our tariffs and packages
194
Social investment projects
204
Contribution to exchanging knowledge and experience across all stakeholders
205
Our public affairs
207
Value oriented, responsible supply chain management
180
Our social values and relations
Our social values and relations
Inputs
Outputs
Value created
million mobile and
33.4
2.4
million fixed
customers
15
points difference
with the second
closest competitor
on customer net
promoter score
18
minutes average
response time over
all platforms and
accounts
100
thousand
students reached
through Turkcell
Whiz Kids Project
7.5 million
participants attended
the Developers of
the Future Platform
trainings
10
thousand
visitors to Turkcell
Dialogue Museum
30
startups working
with the Business
Cooperation
Model
36.1%
of procurements
from local suppliers
which comprise
90% of our
suppliers
Outputs
Our strong relations with our
employees, their families, customers
and suppliers, and our common values
• Strong Sales Channels
• Turkcell Common Values and Code of
Business Ethics
• Supplier Portal
Civil society, academy, public and
corporate partnerships, international
representation of our country and
sector
• National and international
NGO memberships
• Social investment projects
• Turkcell Foundation
• Turkcell Volunteers
Social investment projects and
sponsorships
• Education without Boundaries
• Whiz Kids
• Women Developers of the Future
• Zorlu Performance Arts Center
• Video Call Center
• National Football A Team Sponsorship
• Sponsorships for Athletics - Swimming
Projects and Turkish Sports Federation
for the Physically Disabled
• Supporting arts & culture and sports
projects
Transparent and trust oriented
stakeholder relations
• Transparent communication with the
public, sectoral development focused
relations management
• Ambassadors Summit
• Transparent and active investor
relations management
Strong corporate governance
Value creation through social
investment projects
• Impact analyses of projects and
their results
• Support for closing the digital gap
in society / digitalization rate
Contribution to exchanging
information and experience among
stakeholders
Net Promoter Score
Adapting responsible and ethical
business mentality to the Turkcell
ecosystem
Contribution to the socio-economic-
cultural development of society by
supporting NGOs
Net new customer additions
Being the leader and guiding
company in the sector and country by
representations
• Development of the
telecommunication sector
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TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
182
With the power
we derive from the
core competencies
within Turkcell’s DNA,
we create social
value through more
efficient, ethical, and
transparent stakeholder
relationships. These
serve the common
good of society by
transforming our social
and relational inputs
into meaningful outputs,
highlighting the healing
power of technology.
Turkcell social values and relations
management
We bring our value-creating Turkcell
identity in our social values and stake-
holder relationships together with the
vision of providing superior digital
services for a better future. We ensure
respect for our stakeholders’ rights
through Turkcell Common Values and
Business Ethics Rules (TODİEK) and
our Anti-Bribery and Corruption Pol-
icy, which guides our business model.
Turkcell common values
• We value people
• We own our social values
• We are rich in our differences
• We are here for our customers first
• We are an agile team
• We believe in open communication
• We make a difference
Turkcell business ethics rules
• We respect fundamental freedoms
• We act within certain rules
concerning invitations and travel
• We pay attention when giving and
receiving gifts
• We realize our social responsibility
projects in good faith
As with technology, so too in the
spreading of environmental aware-
ness, do we act from the responsible
position of leadership. We comply
with the laws and regulations enact-
ed on the environment, health, and
safety. We ensure the effective man-
agement of all our service activities,
the security of our information assets
against risks, and their accuracy and
continuous availability, by operating
the
information security manage-
ment system based upon our infor-
mation security policies and with the
approval of our Senior Management.
Accuracy is the basis of financial and
commercial
record management,
and we comply with the national and
international legal regulations that
we are bound by to the highest pos-
sible degree.
We comply with both
the US Anti-Bribery
and Foreign Corrupt
Practices Act (FCPA)
and local laws in our
interactions with public
institutions.
COVID-19 note
While maintaining our position
as the communication and tech-
nology leader, we managed our
social values and relationships,
which we view as being among
the main considerations during
the pandemic worldwide. In light
of our Life’s at Home motto, we
have demonstrated to our cus-
tomers and employees that we
offer technologies that uninter-
ruptedly continue education and
work from home, while support-
ing our ecosystem. We worked
towards the goal of having hap-
pier and more loyal customers
with our interactive events and
sponsorship activities. During the
early days of the pandemic, our
CEO Murat Erkan joined over 5
thousand Turkcell employees in
live broadcasts on Pikcell. We
conducted the COVID-19 Virtual
Work Assessment Survey to un-
derstand our employees’ needs
at the start of the pandemic.
In light of employee feedback
gathered by these surveys, we
swiftly developed our processes
and principles. We conducted
comparative surveys to measure
the productivity and experienc-
es of our employees in this pro-
cess and implemented different
working models (such as work-
ing from home, mobile working)
and we conducted focus group
studies on further improvement
areas. We enabled employee
feedback concerning both their
physical and mental health, and
took action accordingly during
the pandemic and period of re-
mote working through the “How
are you Turkcell?” project. We
called all our employees and
business partners who were
physically or mentally unwell,
lending our support and inquiring
into their condition. We organ-
ized social events such as fitness
programs, sports team activi-
ties, online workshops, e-games
tournaments, Lucky One Knows
competitions and Coffee Break,
in which all our employees could
participate online. In addition to
these, we continued to strength-
en the Turkcell team spirit and
employee motivation with activ-
ities on special occasions such
as April 23 National Sovereignty
and Children’s Day, mother’s/fa-
ther’s day, software developer’s
day, engineer’s day, and via ap-
plications such as Instant Awards
and CXO Awards. Moreover, we
made the working from home
period more comfortable and
easier for our employees by or-
ganizing special campaigns us-
ing Turkcell’s internet and digital
application services.
Meanwhile, we stood by our
customers during the pandem-
ic period. We implemented a
support plan that includes our
telecommunication
benefits,
fixed internet, mobile internet,
and bulk SMS, for those SMEs
that have experienced difficulty
due to business closure. With-
in the scope of Water of Life
aid, we offered free fixed inter-
net for the first three months to
small businesses returning to the
workplace after the COVID-19
lockdowns, we provided com-
plimentary mobile data for their
communication needs, and to
support them during the normal-
ization process. We doubled the
packages of SMEs keen to pro-
mote their campaigns via mes-
sage by gifting up to the quantity
of SMSs received from the Mes-
sage Base service, and gave SMS
gifts to businesses subscribed to
the service. We reached 47.7 mil-
lion people through the commu-
nication of Water of Life aid for
tradesmen.Our digital advertise-
ment video has been viewed 1.4
million times and our campaign
page registered 209 thousand
clicks. While 150 thousand cus-
tomers won GB gifts, Bulk Mes-
sage package sales increased
by 50%. We carried out projects
focused on managing the im-
pacts of the crisis with our pub-
lic sector business partners, the
Ministry of National Education,
and the Ministry of Health, as
well as with those from the civil
society. We doubled the monthly
internet quota to 6 GB for ‘teach-
ers and students’ using the EBA
infrastructure. To support health-
care professionals working with
great devotion for our health,
we gifted additional data and
voice packages. Furthermore, we
have supported the stay at home
movement, a key one of the most
necessary means of beating the
virus, by changing the network
text on our customers’ phones
to “lifesathome”. In this process,
we constantly informed our cus-
tomers through our social media
accounts, sharing
information
on the current situation for their
greater convenience. Meanwhile,
with the #lifesathome concerts,
we united Turkey’s beloved artists
with their fans. For moral support,
we put 11 performances with 8
million interactions into service,
which can be viewed again on
TV+ and fizy. As of September,
we started to transform income
generated by the recycling of
electronic waste collected from
the public at Turkcell stores into
educational scholarships for the
children of our health heroes who
lost their lives to the pandemic, as
part of our Recycle for Education
project. We believe that what
the pandemic has reminded us
of the most is the need to work
together for a “better world”.
With this in mind, we started the
“A Better World” internal initiative.
Through all these practices, we
aim to enhance sustainability, the
focus of our business model, in
the eyes of our employees, and in
social values and relations.
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Our social values and relationsTURKCELL INTEGRATED ANNUAL REPORT 2020
making process with common pur-
pose to meet the needs of all our
functions during the pandemic with-
in the scope of “Alternative Working
Models in the New Working Culture”,
which we plan to implement in 2021.
We secure the working rights of
the productive Turkcell family with
our policies that operate within the
framework of decent work practices.
As part of Turkcell
Human Rights Policy,
Human Resources Policy
and equal opportunity
applications, we
continue to connect
millions of people to
life daily with the best
services and products,
with the support of
our productive Turkcell
family and as members
of the best teams at
Turkey’s digital operator.
Our brand
We lead our country’s
technological
development with our
vigorous brand, strong
infrastructure, superior
analytical capabilities,
and qualified human
resources.
individuals
and
We
empower
organizations, making
life easier,
fun, and secure for them with our
customer-oriented approach, superior
analytical capabilities, and innovative
digital products and services. We
continue to differentiate the customer
experience with offers tailored to the
needs of each segment. Thanks to
our strong infrastructure, we continue
to meet the communication needs
of our country at high speed and
without interruption. Our corporate
is always supportive of
business
the
leading companies of Turkey
and SMEs alike. We increase our
contribution to the Turkish economy
by being their business partner. The
social responsibility projects we have
implemented help us attain the goal
of becoming a stronger society by
promoting equality in all areas, and
the unity of our country.
184
Our social values and relations
Our corporate social values
and relations
With great devotion we have ma-
naged all our social relations as a
technology company offering inclu-
sive, accessible, and superior digital
services, and in line with the goal of
being Turkey’s Turkcell, set among our
communication focuses at the start
of 2020. Under our Senior Manage-
ment leadership, we have developed
our competencies in relations ma-
nagement, an area of strength for
us, together with our employees at
all levels. We manage our relations
through TODİEK, our guide for social
values. With the support of our Seni-
or Management, we strive to create
a business culture across all activi-
ties that complies with the law and
Turkcell’s own policies, by acting in
accordance with the set of rules de-
termined by TODİEK. In this context,
Turkcell Senior Management acts in
a conscientious and reliable manner
by ethically evaluating the conflicts
of interest that arise, or that may ari-
se from personal relationships and
financial or commercial interests as
part of their responsibilities towards
Turkcell.
Our Management Team
makes complete, fair,
accurate, timely and
clear statements in all
company reports and
documents disclosed to
the public, or submitted
to the capital markets
regulators, and acts
in compliance with all
laws, regulations, and
rules that Turkcell is
bound by.
You may find more detailed
information about our corporate
structure in the strong corporate
governance section of our report.
TURKCELL INTEGRATED ANNUAL REPORT 2020
Employee relations
We determine improvement actions
by listening to the expectations, re-
quests, and complaints of our em-
ployees through periodically con-
ducted Employee Engagement Sur-
vey and Pulse questionnaires.
We undertake the use of various
communication channels to better
understand the needs of our em-
ployees. In this context, we organ-
ize workshops and regular informa-
tion sessions with the communities
formed by our colleagues across di-
verse functions and tasks. Believing in
the power of instant communication,
we manage our intra-company com-
munication processes interactively on
the BiP groups we have created for
our employees, and work towards a
timely response to their needs.
We launched the HR Volunteers plat-
form in 2020 with the voluntary par-
ticipation of 101 employees from all
functions within Turkcell. Regardless
of their roles within the organization,
we aim for our employees, who have
the power to influence and drive
change, to become change ambas-
sadors. These, as our HR Volunteers,
will add value to the development of
human resources processes, practic-
es and products, acting as catalysts
within the organization by enriching
the employee experience. With our
YUPO initiative, we run support pro-
grams for our employees identified
as being of high potential. We aim to
support our employees’ career devel-
opment through our committee and
Performance Coaches, established to
support the performance period pro-
cess and monitor performance eval-
uation stages from a function-based
perspective. Through the DOX (Digi-
tal Office Experience) Digital Office
Committee and the DOX Subcom-
mittee, we will operate our decision
Turkcell in communication
Despite the challenging conditions of
2020, it has been a year in which we
both consolidated Turkcell’s leader-
ship in network capacity and made
a difference with our compassionate
and attentive communication ap-
proach, by prioritizing customer need
during the challenging pandemic pe-
riod.
As a Company that reflects social
consciousness to its communications,
we began 2020 with the movie “Kad-
er” highlighting the importance of
equal opportunity.
While fulfilling its corporate social
responsibility mission of raising mo-
rale under pandemic conditions, our
commercial, “Be Patient” became one
of the most successful of the period.
With it, we aimed to make everyone
who had to stay home feel that we
were right there with them under all
conditions, and that these difficult
days would eventually pass. We did
this as a brand with the long-estab-
lished mission of connecting people
to life under the motto of “Connect
to Life”.
We conducted our “So Attractive”
communications throughout the year
to underline the urgency of connec-
tion quality and to highlight our supe-
riority in this regard, with emotionally
themed advertisements at the fore-
front. As Turkcell, we continue to work
towards goals such as internet speed
through the strength of our high
network capacity, while being the
best operator. We reached 58 mil-
lion people with 98% integrated ac-
cess through our commercial film, in
which we showcased national gems
ranging from Ordu to İzmir, and from
Ağrı to Urfa, as well as our coverage
quality. Our So Attractive (Çok Çekici)
campaign has been among the most
appreciated commercials with a 41
AHI score, becoming the most pop-
ular and recalled commercial in July
and August according to Adwatch
results.
We also launched İşTurkcell to posi-
tion our corporate marketing busi-
ness as part of segment communica-
tion for addressing the technological
needs of our corporate customers
under “Business at Technology, Tech-
nology at Turkcell” motto. Through the
new communication platform under
the İşTurkcell brand, which offers our
products to customers ranging from
tradesmen to SMEs and corporates,
we conveyed the message that our
customers need only consult Turkcell
for technological products and solu-
tions without turning elsewhere.
TURKCELL INTEGRATED ANNUAL REPORT 2020
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186
Strong sales channels
and our services
Our sales channel structure
We bring our customers all the ad-
vantages, tariffs, devices, products,
and services that Turkey’s
leader
communication and technology com-
pany offers. We continue to develop
solutions and provide customer-focu-
sed services through Turkcell stores,
alternative sales channels, the online
channel, the Digital Operator appli-
cation, Fiber and DSL solution centers
and corporate sales channels.
Our retail channel
At our retail channel, we continue to
provide Turkcell quality services at
around 1,300 Turkcell stores, whose
digital transformation was comple-
ted in 2018, and at 4,408 digital sales
points.
As a company that
pioneered the digital
transformation of
Turkey, we now have a
new generation store
concept where physical
contact points are
minimized.
Digitalized experience
with contactless store
During the COVID-19 period, we
implemented
“Contactless
the
Shopping” concept as of Octo-
ber to protect the health of our
customers and employees, and
to minimize physical contact.
Now, our customers will be able
to check the offers, device spec-
ifications and award winning
games at our stores by scanning
the QR codes using their own
smartphones.
We offer our devices, tariffs and digi-
tal service products in a clear, conven-
ient, and visually enriched manner with
“GO” that digitalizes sales conversa-
tions between employees and custom-
ers as links in the digitalization chain.
In addition to the benefits we provide
to our customers; we increase employ-
ee engagement and motivation with
special awards. In 2020, we enriched
the TRY/package top up and bill pay-
ment experience by implementing the
“GO Cash” application at the payment
point, where customer traffic is heavy.
We added value to our service model
with the ability to offer our customers
instant personalized offers, increas-
ing our sales force, and continuing to
raise customer satisfaction through
improved experience with “GO Cash”.
In our supply chain model, we acceler-
ated the product order processes of our
dealers with Turkcell Portal. We trans-
formed from a B2B portal operating
with limited products and categories
into a “Digital B2B Procurement Plat-
form” that can supply a wide range of
products and categories from multiple
channels with a multi-vendor structure.
We continue to provide customized
guidance to our dealers according to
their orders and sales. We accelerated
our processes and enhanced the expe-
rience by establishing a “Content Man-
agement Team”. Currently, we offer
24 thousand products of 260 brands
through 110 suppliers via Turkcell Por-
tal. To make the customer purchasing
We launched a new era in device
sales. We began to provide con-
tracted offers and made Finan-
cell credits available to our pre-
paid customers who were previ-
ously only able to purchase de-
vices in cash. Thus, we offer our
prepaid customers the opportu-
nity to purchase a device with a
contract, or an upfront contract
without switching to postpaid.
experience contactless, easy, and fast,
we implemented the “Reflect to my
Bill” application. Today we ensure that
the amount of the purchased product
is reflected to the customer’s bill via
Paycell. Thanks to “Pay by Bill”, which
can be used not only for one product,
but for the payment of the entire bas-
ket, our customers can now purchase
products using only their smartphones
without signing any documents.
We also began to provide servic-
es for new customer registration and
customer number porting activation
transactions, by extending the scope
of the “Bi tıkla Mağazada (At the Store
with a Click)” application launched in
2019 and used in the delivery process
for devices purchased through tele
sales channels in the physical chan-
nel. Our customers can conveniently
pick up the products that they reserve
on turkcell.com.tr or through tele sales
channels at Turkcell stores in their pre-
ferred locations. For a unique and unin-
terrupted Turkcell experience, we give
our customers the option to choose
the channel.
Digital Signature
As of May 2018, we completed
the digital signature transforma-
tion of all our stores (TİM/DSN/
DSN+) for individual mobile tran-
sactions. As of September 2020,
we completed the digital signa-
ture transformation of all our in-
dividual fixed customers at Fiber
Solution Centers and DSL Soluti-
on Center Business partnerships.
Accordingly, the digital signatu-
re usage rate of our individual
fixed customers soared by 98%.
As a result, while reducing our
costs on such items as archives,
documents, and cargo, we also
enabled more secure, faster, and
easier transactions for our custo-
mers.
Our alternative sales channel
As part of our alternative sales chan-
nel that has reached a sales volume
of 26.8 million products, we trans-
formed each channel reaching the
customer into a sales channel, while
continuing to serve through Hyper-
markets, Bank Channels, Chains and
Telesales. Our Telesales channel has
also become the major sales chan-
nel for our digital services with 2.5
million sales of TV+, lifebox and fizy
products, making use of big data,
our analytical models and artificial
intelligence. With TV+, lifebox, and
fizy collaborations with banks, we
ensured the brand recognition of our
DSS products and increased our sales
by directing customers to our digital
channels. In Bank and Market chan-
nels, we achieved a sales increase of
up to 46% by offering TRY/package
products to customers seeking ac-
cess to this service from their homes
due to the pandemic.
Digital sales channels and services
As part of the digitalization focus, our
online sales channel has also taken
steps to shape Turkey’s e-commerce
sector in 2020. While the number of
visitors to digital sales channels reac-
hed 30 million per month in 2020, the
3-month active users of Digital Ope-
rator application was 23 million. To-
day, the digital channel share in total
retail device sales revenue has incre-
ased 3.6 times compared to the pre-
vious year, while total TRY/package
downloads had a threefold increase.
In this context, the share of digital
sales channels in Turkcell Turkey con-
sumer revenues (excluding our fixed
business) reached 14.3% in fourth qu-
arter of 2020.
In line with our channel
growth strategy, we
shaped our investments
with a focus on
communication, traffic,
sales, delivery, and
loyalty.
We implemented various technical
improvements to enhance the pro-
cesses by working with Turkcell’s pro-
fessional ICT team. Under our Artifici-
al Intelligence and Data Analytics te-
ams’ leadership, we implemented our
sales setups, where we emphasized
the importance of personalization.
We have adopted a creative, friendly,
value-oriented, and familiar approa-
ch to communication. We maintained
our focus on hourly and nighttime
campaigns to encourage our cus-
tomers to spend more time on turk-
cell.com.tr. Our campaign called the
“Those who can’t Sleep Club”, active
between 22.00 and 02.00 during the
night, was the bronze prize winner in
the Direct Response/Lead Generati-
on category of MIXX Awards Europe
2020, organized by IAB Europe. “Tho-
se who can’t Sleep Club“ will continue
to bring our customers brand-new
concepts with a focus on the right
time and right product at the right
price. For our customers who look for
more internet and more advantage-
ous prices, we have begun to design
campaign formats for both postpaid
and prepaid Turkcell products, as well
as for new customer registration and
customer number portability catego-
ries.
increasing our
recognition
While
with the use of accurate and tar-
geted media, we sought to create
the perception of turkcell.com.tr as
offering a wide range of affordable
products with a quality experience.
We boosted new customer traffic on
the website with our strategic cam-
paigns. Focusing on an uninterrupted
and excellent customer experience,
we listened to customer requests
and complaints on social media; we
prepared campaigns that reflected
their wishes; we popped up on both
product detail pages and basket pa-
ges with complementary product
suggestions. We created alternative
payment methods for purchases and
provided delivery within 24 hours. By
providing differentiated subscription
services, we facilitated the applica-
tion process and better served our
customers, delivering their sim cards
to their homes.
Our next move to expand our di-
gital sales channels, Turkcell Pasaj,
has been launched in December
2020. Turkcell, the world’s first di-
gital operator, takes its place in
the rapidly growing e-commerce
market in the field of consumer
electronics. Within the scope of
Turkcell digital sales, we introdu-
ced our marketplace platform,
Turkcell Pasaj, on which diverse
customers and suppliers will be
able to buy and sell products in
the electronic products category
under www.turkcell.com.tr. In the
future, it will be possible to sell
electronic products to Turkcell
and even other suppliers via this
channel.
Collaborating with Turkey’s largest
and most reliable suppliers, Turkcell
initiated this journey with the goal of
providing “secure online shopping”.
Thousands of products from smartp-
hones to vacuum cleaners, and from
hobby products to computers, are
available on Turkey’s first electronic
marketplace platform “Turkcell Pa-
saj”. Providing users fast delivery and
flexible payment options, Turkcell Pa-
saj also offers easy cancellation and
refund options.
Discount options that fit all comers
are offered on “Turkcell Pasaj”. The
customers of all operators can also
enjoy those. “Turkcell Pasaj” custo-
mers will soon be able to pick up
their products purchased on the plat-
form around 1,300 Turkcell stores ac-
ross Turkey. Thus, a real online/offline
shopping experience will be introdu-
ced on “Turkcell Pasaj”.
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Our social values and relationsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
188
Our tariffs and packages
Our postpaid packages
We provide a “superior” experience
with our rich content offers tailored
to the usage habits of each customer
through the Yıldız, Bol, Platinum and
GNÇ packages we introduced in the
second half of 2020. By following cur-
rent trends, we respond to changing
customer usage needs by adding
internet quotas valid in social media
applications in the recently introdu-
ced Platinum and GNÇ packages. We
allow our Platinum customers to ma-
nage their calls and internet needs as
they choose with the For Me Campa-
ign that converts unused minutes to
GB. Moreover, our customers can also
easily access the usage and payment
alternatives most suitable for their li-
festyle with our Comfortable offers,
which do not require contract. Com-
fortable offers protect customers
from exceeding their consumption li-
mit while providing flexible payment
convenience.
Our prepaid packages
We constantly track the usage habits
and needs of our prepaid customers
through big data and market analy-
ses, and regularly update and widen
our prepaid package alternatives ba-
sed on changing customer needs.
In addition to the
monthly packages, we
address the short-term
needs of our customers
through our weekly and
daily solutions.
requiring
Our customers can report their net-
work connection complaints to us via
the application by doing the auto-
matic call connection control from the
“Help” feature, and easily complete
their document
requests
from the “Submit Request” feature by
adding a photo of the related docu-
ment. Moreover, all requests and com-
plaints can be easily tracked. In ad-
dition to all these, our customers get
support from the artificial intelligence
backed Turkcell Assistant whenev-
er required, and can easily perform
many transactions without having to
reach the call center. Our customers
can manage all their Turkcell sub-
scriptions including fixed broadband
and mobile lines from a single appli-
cation by adding each to the platform
via the “Add Account” function. Nearly
300 thousand Superonline custom-
ers make 2.5 million transactions per
month using Digital Operator. With
the addition of the Gift Pool feature to
the Digital Operator, introduced on 14
October 2019 and visited nearly 500
thousand times per day by Turkcell
customers, our customers can view
and track all the gifts and privileges
they have earned to date, as well as
those they can potentially get from
Turkcell over the coming periods, on a
single space.
We enable our corporate customers
to carry out all relevant transactions
regarding their corporate lines over a
single platform through the My Com-
pany application, which is tailored to
corporate customers. We forward de-
velopments regarding corporate lines
to relevant company officials through
instant notifications. Turkcell provides
speed and convenience to company
officials enabling them to carry out
transactions such as switching to ap-
propriate offers and campaigns, and
SIM card changes online and without
paperwork. We provide convenient
offers for our customers as part of
digital special packages sales.
We celebrate their birthdays and pro-
vide them a personalized experience.
In 2020, 300 million transactions have
been made via My Company’s web
and mobile application platforms,
used by 350 thousand companies.
Over the coming periods, we will
continue to hone our muscles in the
e-commerce world where speed,
logistic services,
product diversity,
diverse payment alternatives, brand
assurance and innovative approach-
es are competitively significant. We
will ensure an excellent experience for
our customers with the backing of our
Group Companies and bring them the
channel-specific solutions of Paycell
and Financell.
As for the past 27 years,
we view our customers
as being among the key
members of our Turkcell
family, and we work
to add value to each
moment of their lives.
Our Digital Operator application,
which we developed in order to re-
spond to customer needs using the
most appropriate means, became
the most preferred service and sales
channel of Turkcell customers, reach-
ing 56.4 million downloads in 2020.
The 3-month active users of the appli-
cation reached 23 million and Turkcell
customers made their transactions on
Digital Operator with an average of
225.4 million logins per month over the
past year. In addition to viewing their
remaining usage through the applica-
tion; our customers can view and pay
their bills, access packages, services
and campaigns that fit their needs,
and switch between offers instantly.
We remember the special days of our
customers and celebrate them via the
application, sharing personalized re-
minders and information. Additionally,
we help our customers to make the
right transitions at the right time with
proactive notifications. We also offer
our customers suitable device and
accessory offers on Digital Operator.
Our cargo tracking module displays
the delivery status of the products
they purchase.
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Innovation
In 2020, we continued to focus on
applications and offers featuring in-
novative solutions to increase both
customer acquisition and customer
loyalty.
SDG 8.3
Turkcell Biz (Family and friends):
Our innovative digital platform
We have created an innovative digital
platform that is unique in the sector,
where our customers can come to-
gether with their loved ones to cre-
ate groups and earn more together.
At Turkcell Biz, our individual postpaid
customers can set up groups of a min-
imum of 2 and maximum of 5 people,
free of charge, without any package/
tariff changes. Members can share GB
with each other for free and benefit
from exclusive internet gifts.
With Turkcell Biz, we have attained a
digital value that will increase both
customer acquisition and customer
loyalty, offering innovative setups.
Postpaid Mega Packages
Our customers can utilize the us-
age quotas in their packages as they
choose for a year with our annual lim-
ited offers, introduced exclusively by
Turkcell as a first for Turkey, and make
their payments monthly at a fixed
price. Thus, package contents are ef-
fectively used and package limit ex-
ceeding problems are avoided.
Prepaid Mega Packages
In particular with the changing habits
during the pandemic, we have added
the 3-month Mega Package alterna-
tive to our product range for our pre-
paid customers requiring longer-term
packages. Thus, our customers who
wish to install a Mega Package in-
Our social values and relationsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
190
Turkcell Fiber Speed Festival
Given the rising need for household
internet speed, especially during the
pandemic, we
launched a Speed
Festival at Turkcell Fiber to bring the
speed and quality of Turkcell Fiber to
even more households. We focused
on meeting customer needs with high
speed and diversified campaigns. We
began to offer our customers 200
Mbps speed for the first time at the
retail level. Our customers using inter-
net at 100 Mbps and above doubled in
number within a short period of time
due to the campaign.
Our corporate packages
With our innovative offers, we gener-
ated solutions tailored to the increas-
ing internet needs of our corporate
customers. By strengthening our im-
age of a superior service provider, we
continued to focus on new custom-
er acquisition and existing customer
management.
Our customers who bought a new sim
card are connected to life via Turkcell
with our innovative offers and prop-
ositions featuring abundant internet
and gifts.
We multiplied the advantages of be-
ing a Turkcell member with compli-
mentary social media packages, lim-
it-stop service, and campaign propo-
sitions ranging from fuel to electricity
bills.
We have provided solutions tailored
to the needs of our customers for their
growing mobile and fixed internet us-
age.
stead of topping up on a monthly ba-
sis, need only do so every 3 months,
and can divide usage in the package
to different periods according to their
needs.
Prepaid packages that can be offered
as gifts
In light of the changing habits of our
customers and the pandemic environ-
ment, we activated our prepaid pack-
ages that can be offered as gifts. Duly,
without leaving their homes, our cus-
tomers are able to purchase commu-
nication packages on the Digital Op-
erator for their loved ones on special
occasions such as birthdays and anni-
versaries, and send them with person-
alized messages and images.
Our fixed services
The need for internet speed, being the
most critical component of household
internet for our customers, has gained
in significance during the pandemic.
We continued to meet our customer’
needs with Superbox, which offers
a unique customer experience with
easy installation, portability, and fast
internet. As part of Turkcell Fiber, we
provided high speed and campaign
diversity to meet the needs of our
customers, who have experienced its
unique speed, during the pandemic
period.
Superbox Plug-Go
By changing the definition of
household internet in Turkey,
we ensure cost advantages,
while enabling our customers
to access internet from the-
ir households by visiting the
nearest Turkcell store without
waiting for installation. By pro-
viding credit financing via Fi-
nancell, we offer various pay-
ment options to our customers
and gain on capital costs.
We offered our customers the oppor-
tunity to purchase additional packag-
es either by reflecting them to their
bills, or by credit card via Digital Op-
erator. We diversified the additional
packages they could purchase and
enabled those of our customers re-
stricted by company officials from
purchasing additional packages by
reflecting them on the bill, to purchase
additional packages exclusive to their
corporate lines with their individual
credit cards. We introduced Flexible
Packages for those customers who
use data lines and cannot use up their
internet, allowing them to use the GBs
they purchased on their smartphones.
Hence, they were able to use a single
internet package on two devices. We
have introduced advantageous Hot-
spot Packages, so that our custom-
ers can easily connect to the internet
from any device without the need to
search for a Wi-Fi connection.
By focusing on our existing customers,
we consolidated our image of “supe-
rior service provider”.
By introducing the anniversary cam-
paign, we gave away 5 GB of internet
per day to all our customers on the
anniversary of their joining the Turkcell
Corporate family.
to
internet
We allowed company officials to
send
their employees
through the complimentary GB pool.
Through this campaign, the GB pool
allowed those officials to distribute
complimentary GBs to corporate lines,
instead of offering this to corporate
lines separately.
Our segments
By adding new digital privileges to our
loyalty programs during the pandem-
ic, we remained the brand offering
superior services, and making a dif-
ference as a superior service provider
in the eyes of our customers.
New digital privileges exclusive for
changing needs at Platinum
This year, Turkcell embraced innova-
tion by giving its customers privileg-
es not offered before with Platinum,
which appeals to those customers
with
intensive communication and
internet needs. During the pandem-
ic period, we provided opportunities
in many areas such as free premi-
um membership to fizy and TV+, gift
books, organic household shopping
and children’s clothing shopping with
the Platinum at Home tab. We also
met many customer needs by offer-
ing Platinum privileges through digital
channels, making Turkcell products
easier to access. We provided com-
plimentary internet packages valid on
the online education platform (EBA),
and recognized the device and tar-
iff/package needs of our customers
aged over 60, establishing a special
communication channel to meet their
requests. By keeping our customers
engaged with Platinum Dream Gifts
raffles, this feature scored its histor-
ic highest beneficiary number ap-
proaching 4.7 million times, involving
310 thousand individual customers.
With a growth of 18% compared to
the previous year, the Platinum Privi-
lege Program reached approximately
400 thousand unique customers and
over 5 million interactions. This year,
our brand has enriched the lives of our
customers with our sponsorships and
privileges such as Turkcell Platinum
Bosphorus Cup, Platinum Park, Turk-
cell Platinum Night Flight Concerts and
Zorlu PSM, having become a desirable
brand to be a part of.
In the second wave of the pandemic,
we introduced the new tab, Long Live
the Weekend with Platinum, where
we offer our customers end-to-end
digital privileges. We enabled our
customers to enjoy numerous privileg-
es at home without having to go out.
They met their daily needs thanks to
the discounts on Getir, Tchibo online,
and kahve.com without leaving home,
while we offered an entertaining stay-
home experience through privileges
such as Zorlu PSM online events and
gift tickets, TV+ Premium membership
and D&R online store gifts.
You may visit Turkcell Platinum
website to discover the
privileged opportunities of
Turkcell Platinum.
GNÇ App: 2020, the year of
records at GNÇ!
GNÇ, the favorite application of our
youth, added to its records this year.
The GNÇ application ended the year
as Turkey’s most downloaded youth
application with 11.5 million down-
loads.
We offered an opportunity to those
young people who want to become
entrepreneurs through the GNÇ Idea-
thon competition for the second time
this year, awarding the winners. This
year with 3,600 ideas, the number of
applications to the competition has
doubled from last year.
2020 was a record-breaking year for
the Crack the Egg Campaign, a fa-
vorite among young people, during
which we gave 79 million gifts to our
young customers.
During the COVID-19 period, we have
developed two new games within the
application to offer innovations to our
young people. We achieved a 30%
rise in application usage thanks to
the high interest shown by our young
customers in Blast and GNÇ Trivia.
We will continue to invest in the GNÇ
Mini Games platform by adding new
games to those GNÇ games already
played by 4 million young people on
17 million occasions in 2020, further in-
troducing our innovations to our youth.
The GNÇ Star Music Competition,
which took place for the first time this
year, receiving over 2 thousand appli-
cations, allowed young people keen
to become musicians to showcase
their skills. With Challenge TV, which
we introduced during the GNÇ Star
competition, young people respond to
challenges with videos via the GNÇ
application and win surprise gifts.
We continued to offer benefits to
young people through brand collab-
orations made in 2020. We provided
young people who pay with Paycell
QR a 50% discount on Burger King’s 3
best-selling menus.
With the Push & Take platform, an-
other of our innovations, we offer sur-
prise gifts and opportunities to GNÇ
members every Monday at a surprise
hour from the GNÇ application, invit-
ing young people to the application.
Thanks to the Push & Take platform,
application visits on Mondays rose
by 250% and total application usage
by 15%. In 2020, the GNÇ application
doubled its monthly visitor number to
register the highest numbers ever.
You can access the
GNÇ world and its
innovative applications
on GNÇ website.
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Digital Operator
Over the COVID-19 period, we con-
tinued to create value with our new
projects that address increasing dig-
ital needs and improve customer ex-
perience.
Our digital focus
We have introduced many experi-
ential improvements and exclusive,
advantageous offers for both Digi-
tal Operator and turkcell.com.tr and
other digital platforms, providing
solutions to meet the changing dig-
ital needs of our individual prepaid
customers
that have accelerated
notably due to COVID-19. With these
offers, we have expanded our prod-
uct range, with our customers able to
purchase digitally with a price ad-
vantage and without leaving home.
In 2020, 362 million people visited
turkcell.com.tr. In the prepaid world,
we enabled personalized packages
to be purchased by credit card via
digital channels, making all our pack-
ages accessible. We increased the
share of our digital channel in pack-
age sales to 3.6 times what it was at
the start of the year. Through another
development, we allowed customers
to view all the packages exclusive to
them in a single space under the fast
transaction menu by querying the
number. Furthermore, we activated
our prepaid packages that can be
offered as gift. Duly, our customers
are able to purchase communica-
tion packages from the Digital Oper-
ator without leaving home, for their
loved ones on special occasions such
as birthdays and anniversaries, and
send them with personalized mes-
sages and images.
We started by redesigning turkcell.
com.tr so that our customers could
readily access our postpaid pack-
ages and began to offer our pack-
ages with a fresh and simpler look.
We have implemented our smart of-
fer display model to sort our tailored
offers made to Turkcell customers.
Through the 50 GB additional pack-
age we offer on the digital chan-
nel, we were there for our custom-
ers when they needed us with our
affordable and abundant content
package. Duly, we ensured the satis-
faction of our customers by meeting
their intensive internet needs during
COVID-19 curfews. With the “Gift Pool
Campaign” introduced in April, our in-
dividual postpaid customers can se-
lect the gift they wish from our cat-
alogue when purchasing a new tariff
package.
Shake and Win once again made
a difference in 2020 through its
innovations
While Turkcell customers could
choose the gifts that best fit their
needs among the rich gift options of
Turkcell’s most popular promotional
campaign, Shake and Win, they had
the flexibility to use their gifts when-
ever they wanted. With the “Shake
and Win GB Festival”, we introduced
mega internet gifts of up to 25 GB,
never seen before in the history of
the campaign. Over 13 million Turk-
cell customers shook their phones in
2020 via the Digital Operator app.
We shared over 60 million gifts with
our customers every month. To max-
imize customer interest, and given its
contribution to income, other prod-
ucts, and digital services, through
Shake and Win we made diverse of-
fers and digital services promotions
this year for customers who partic-
ipated weekly in the campaign. We
also supported the active usage of
Turkcell digital service campaigns
through promotions on Shake and
Win.
Turkcell’s full Support for women
through Bizce!
We
renewed Turkcell
Bizce, Turkcell’s women’s
platform, which set out
to provide “full support
to women” with its con-
tent and design that en-
dorse women’s active participation in
the economy and self-development,
and that offer solutions to important
issues of interest. With the renewed
Bizce, we offer brand-new features
and content to meet the changing
needs of women. Women also sold
16
their handcrafted products at
thousand stores in Our Market plat-
form. In addition to the high quality of
the handcrafted products, the safe
home delivery option has stood out
as the key feature of the application,
especially during the pandemic. We
hosted experts in the Expert category,
where many questions uppermost in
women’s minds from health to cuisine
are answered with videos that were
viewed around 200 thousand times.
With the Collect Coupons Campaign,
we distributed 350 thousand gifts
daily to our users of the application,
who collected 10.6 million coupons.
We offered advantages with our sur-
prise draws and brand privileges. Our
astrology feature was used around
500 thousand times. With our brand-
new Share Discount feature, our us-
ers shared their discounts with each
other. During this period in which we
have stayed at home, new DIY, rec-
ipe and handicraft videos for wom-
en were viewed 250 thousand times.
Our users can also access content on
a wide range of topics, such as the
inspiring stories of women entrepre-
neurs, business planning, and working
parents on the Bizce app under the
Get Inspired and Self Development
categories.
Our customer relations
Customer satisfaction
and loyalty
As the Turkcell family,
we strive to make our
customers feel “Safe,
Valuable, Happy” in
every decision we
make and with every
product or service
we design, and we
aim to provide our
customers with an
“easy, personalized and
consistent” experience.
The customer-oriented
cultural transformation
we initiated in 2019 is
at the heart of every
decision taken by all
Turkcell employees with
the “being here for my
customer” mindset.
We pay attention to
our customers’ needs
and demands with
our people-oriented
communication,
reflective of our
adopted mission.
Primarily, we design our
products and services
so as to create value
for people, making
them accessible for
all to help eliminate
social inequalities.
We consider our high
customer satisfaction
a crucial metric of our
success.
Number of customers (million)
Mobile
Fixed
2018
33.8
2.3
2019
32.7
2.3
2020
33.4
2.4
Also in 2020, we continued to see higher Net
Promoter Scores compared to our competitors in
Turkey in individual mobile, corporate mobile, and
fixed individual categories.
Customer Net Promoter Scores (NPS)
2018 last
quarter
2019 last
quarter
2020 last
quarter
Gap between the closest
competitor
Gap between the second
closest competitor
13
23
With a focus on growth in new post-
paid customer acquisition in 2020, we
continued to offer our customers inno-
vative offers of rich content, consist-
ently updated according to customer
need. Despite the pandemic that be-
gan to have its effect in March, we
increased our postpaid customer ac-
quisition by 8% compared to the pre-
vious year. In addition, we have seen
a greater performance in the Mobile
(MNP) market
Number Portability
compared to 2019. In 2020, we start-
ed to offer content-rich packages to
our new prepaid customers. With the
normalization process, we increased
the revenue contribution of our new
prepaid customers by boosting our
share in the number porting market
and packaging rate.
With a “Single Turkcell” approach,
we prioritize an “Omnichannel Ex-
perience” in our customer relations
management to maintain Turkcell’s
rich channel diversity. With our om-
nichannel projects, we aim to offer an
integrated experience in Turkcell cus-
tomers’ channel interactions where
10
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15
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our customers don’t need to provide
the same information repeatedly. We
also surprise them along their cus-
tomer journey with our technologies
and the harmonious operation of our
channels.
Customer oriented cultural
transformation
Over 500 Turkcell employees have
implemented more than 170 projects
to improve customer experience in
2020 as part of our Customer Orient-
ed Cultural Transformation Program
that we have implemented for three
seasons, within the framework of our
customer-oriented corporate cultural
transformation. The “Customer Expe-
rience Hackathon” that we kicked off
in the third season has allowed our
employees to put into practice those
ideas that make a difference for our
customers during this transformation.
towards
We continue advancing
our goal of “1 million new customers
every year, until 2022”, based upon of
our principles of high customer satis-
faction and loyalty.
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Our social values and relations
Customer complaints management
We commit to addressing custom-
er requests in an open, transparent,
rapid, reassuring and people-orient-
ed way on the basis of our Customer
Satisfaction Policy.
We determine our customer perfor-
mance metrics annually in line with
our customer experience strategy of
continuous improvement in service
quality. This is done by considering
all Turkcell functions together, as well
as the customer experience offered
through our call center, the video call
service for our hearing-impaired cus-
tomers, and digital and face-to-face
services channels, and by monitoring
them throughout the year. Through
7 functions, we ensure rapid action
taking and follow up, as well as end-
to-end customer experience with
cross targeting, and the establishing
of measuring and anomaly detec-
tion structures across 308 experience
metrics.
As well as taking rapid actions, it is
also crucial to clearly understand the
customer, empathize with them and
hear them out. In this context, and to
provide still better customer services,
we now instantly recognize custom-
ers by voice thanks to our text and
audio analytics capabilities integrat-
ed using artificial intelligence.
Thanks to our AI-backed Chat and
Chatbot
infrastructure, we deliver
rapid feedback to our customers to
meet their needs. We monitor the
reasons behind our customer calls
with real-time setups, right from the
welcoming message of the Interac-
tive Voice Response System through
to connection to the customer repre-
sentative, and provide solutions with
proactive scenarios. With the solu-
tions offered to our customers, we
enabled 289.9 thousand Turkcell cus-
tomers to complete their transactions
over IVR by informing 32.5 million of
them in the January-December peri-
od of 2020, resulting in time saving.
We respond 24/7 to our customers
on Facebook, Twitter, Instagram, You-
Tube, and LinkedIn with a total of 55
accounts. We receive 211 thousand
comments on average on social me-
dia from 63 thousand users per month.
We provide support to our users re-
garding our digital applications by
initiating digital dialogue reflecting
the nature of the respective platforms
and our brand positioning. Meanwhile,
we instantly follow up all sectoral so-
cial media interactions with our AI-
backed analysis model and take ac-
tions to improve customer experience.
Average response time of all platforms and accounts (minutes)
35 minutes
2018
20 minutes
2019
18 minutes
2020
%
2
4
9
1
0
2
%
0
1
0
2
0
2
Improvement rate of average response time
of all platforms and accounts, compared to
the previous reporting year
Social investment projects
Creating social value
By leveraging the opportunity of equalizing power of technology, we
implement social inclusion projects that aim to provide all with equal
opportunities in accessing information. Across all our activities we
value the principles of protecting public health, and developing local
communities and economies. For the long term, we aim to contribute
to a more livable world, while making a positive social difference by
allocating 1% of our annual revenue to social investment projects.
Turkcell Foundation
We continue to implement projects
that serve our country and humanity
at large with the Turkcell Foundation,
backed by the strength and reliabili-
ty of the Turkcell brand.
Turkcell Volunteers
One out of five Turkcell employees
is a Turkcell volunteer
As Turkcell Volunteers, we realized
numerous initiatives in 2020 for our
people in need, and among disad-
implement
vantaged groups. We
engaging, strongly communicative,
technology using, participatory and
environmentalist volunteering pro-
jects through “Turkcell Volunteers”,
the entire cost of which is met from
the donations of Turkcell Group em-
ployees.
Corporate social
responsibility projects
Leaving no one behind, we
provide equal access to infor-
mation to children, women, the
disabled, the elderly, refugees,
and economically disadvan-
taged groups thanks to the
opportunity-leveling power of
technology; we cover life and
inspire.
No politically affiliated finan-
cial aid activity has been con-
ducted directly or indirectly by
Turkcell in 2020.
Whiz Kids Project
The Turkcell Whiz Kids Project, car-
ried out in cooperation with the Min-
istry of National Education, aims to
introduce talented students to tech-
nology, discovering and developing
their talents at early ages. Whiz Kids
Technology Laboratories, established
as part of the project, provides stu-
dents with laptops, 3D printers, smart
boards, electronic and robotic coding
sets, and tool kits. Children receive
training and develop projects on ar-
tificial intelligence, coding, space sci-
ence, robotics, the smart home, and
cloud technologies.
As part of the Whiz Kids Project, we
reached 59 laboratories in total in 41
cities by establishing 14 new class-
es in 2020. We handed out close to
1,000 coding education kits during
the year. Students of the Whiz Kids
Project have to date won 266 prizes
at the national and international level.
To date, over 5 million items of edu-
cational content have been accessed
on the Whiz Kids training platform
and free-access mobile application.
70 thousand students across Turkey
have received training. Our education
portal and mobile application include
free-of-charge education content for
all students in Turkey, such as Arduino,
mBot Robot Programming, Robotics,
Space Sciences, Mobile Game Devel-
opment, Artificial Intelligence, Smart
Home, and Deep Learning.
Within the scope of the project, we
have so far;
• distributed Maker and Robotic Cod-
ding Kits to over 30 thousand stu-
dents,
• established 59 Whiz Kids Technol-
ogy Laboratories in 41 cities across
Turkey,
• provided 250 thousand hours of on-
line training, and
• covered 40 thousand kilometers
in Anatolia for face-to-face work-
shops.
The Whiz Kids Project carried out ac-
tivities to contribute to society during
the pandemic. Whiz Kids students in
33 technology classes, with the sup-
port of their teachers, produced face
shields using 3D printers to support
health professionals fighting at the
forefront of the COVID-19 pandem-
ic. Turkcell added new 3D printers
to Whiz Kids classes, whereby Whiz
Kids students were able to produce
15 thousand face shields per month.
SDG 4
SDG 10
Number of students accessed via the Turkcell Whiz Kids Project
2018
2019
2020
Short-term
target
Mid-term
target
Long-term
target
30,000
50,000
100,000
100,000
130,000
150,000
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Our social values and relations
People without Boundaries
Through our technology we pro-
vide many solutions that make
life easier across numerous
fields under the “People without
Boundaries” roof, contributing to
the social inclusion of disabled
individuals. We
leverage the
healing power of technology for
social benefit in the Education
without Boundaries Program,
My Gem Inside Project, Turkcell
Dialogue Museum, Sports with-
out Boundaries Program, My
Dream Companion and My Sign
Language applications.
SDG 4.5
SDG 8.5, 8.6
Education without
Boundaries program
As part of the Education without
Boundaries program initiated in June
2015 under the auspices of the Minis-
try of National Education, we support
disabled students’ development in
education and employment with the
aim of boosting the competencies of
disabled children in need of special
education, ensuring their active par-
ticipation in society. Within the scope
of
the program, we established
technology classes for visually im-
paired students and vocational train-
ing centers for students with mental
disabilities. At the Special Education
Center established throughout Turkey,
students with mild mental disabilities
are prepared for employment after
school in vocational workshops. We
enabled visually impaired students to
code their dreams with a Braille print-
ed coding kit that we provided them
as part of a project launched in 2020.
Since 2015, we have reached over
70 thousand students at 112 schools
across 60 cities. 20 thousand stu-
dents benefited from our projects in
2020. We have also enabled almost
1,000 visually impaired students to
experience the digital world in 2020
through the robotics kit and training
program that we made available this
year for visually impaired people.
Sports without Boundaries
Under the Sports without Boundaries
program we launched in 2020, we be-
gan to support our mentally disabled
students in the field of sports. We sup-
ported our disabled athletes of poten-
tial by establishing sports classes for
special education students in Adana,
Ardahan, Diyarbakır, Gaziantep, Kahra-
manmaraş, Kırıkkale, Konya, Osmaniye,
Şanlıurfa, Van and Erzincan. Students
of these schools will be trained in ath-
letics (disc, javelin, shot put, long jump,
and running), table tennis, basketball,
and gymnastics through sports clubs,
and will be prepared for national and
international competitions. In 2020,
we have established Sports without
Boundaries classes at 11 special edu-
cation schools in Turkey, with almost
5 thousand disabled students benefit-
ting from them. Our project will con-
tinue to support the development of
disabled students in the field of sports,
with national skier Ayşe Kader Yavuz
being the face of the program.
The My Gem Inside project
This project, implemented under
the auspices of the Ministry of
National Education, supports the
education of children with au-
tism across Turkey through spe-
cial classes established in schools
and a free digital application. The
My Gem Inside project, success-
fully funded by Turkcell’s funding
platform, Beehive, reaches out
to children with autism and their
families across Turkey. Within the
scope of the project, implemented
in two areas, special classes with
digital application support are es-
tablished to provide education to
students with autism.
The project supports the educa-
tion of almost 3 thousand children
with autism and learning difficul-
ties at 21 My Gem Inside classes
established by Turkcell at 18 Minis-
try of National Education schools.
The My Gem Inside application,
developed under the supervision
of pedagogues and expert train-
ers, supports the mental, behav-
ioral, and emotional development
of children in need of special ed-
ucation. Moreover, the application
also provides instant reports and
informative content for families
and teachers to help monitor child
development. With the new fea-
ture added to the application on
the 2020 Autism Awareness Day,
and thanks to AI-based develop-
ment, children with autism had the
opportunity to better learn which
facial expression reflects which
emotion through instant imitation
and repetition. During the pan-
demic period, educational con-
tent concerning proper face mask
usage, hand hygiene and social
distancing has been added for
students with autism on the edu-
cation platforms of the Ministry of
National Education.
As of 2020, over 400 thousand
games are being played monthly
on the My Gem Inside mobile
application, with 50 thousand
children reached via the app.
Within the project’s
scope, we have
reached 60,000
students since 2019.
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Our social values and relations
My Dream Companion & My
Sign Language
My Dream Companion
the visually
enables
impaired
receive
to
from hun-
updates
dreds of news sources
in various categories, including sci-
ence and technology, health, sports,
politics, and the economy. Users
also gain access to current articles
of over 2,500 columnists, as well as
thousands of audio books, and in-
tellectual content such as training
materials and magazines. Utilizing
beacon technology, the My Dream
Companion application helps vis-
ually impaired individuals obtain
detailed information about retail
stores as they pass by at shopping
malls in Turkey. Users also benefit
from navigation services through
beacon technology at numerous
malls, university campuses and mu-
seums. Audio description technolo-
gy also helps the visually impaired
to experience movies at all cinemas
across Turkey without losing visual
detail. Many international awards
have been won thanks to audio de-
scription technology that describes
features of the environment, place,
person or object and scenes with-
out dialogue, and have been the
key feature of over 250 general re-
lease, and festival films to date.
My Sign Language Application: My
Sign Language facilitates commu-
nication between hearing-impaired
individuals and those unfamiliar
with Sign Language. The appli-
cation, which features the most
comprehensive Turkish Digital Sign
Language Dictionary, supports the
personal development of the hear-
ing impaired. Last but not least, the
application, that allows access to
the video call service on the app via
Turkcell and Superonline call centers,
has over 130 thousand users.
Turkcell Dialogue Museum
The “Dialogue in the Dark” and “Dialo-
gue in Silence” exhibits initiated in coo-
peration with Istanbul Social Enterprise
to create awareness of social issues,
have been transformed into a perma-
nent museum under the name of “Turk-
cell Dialogue Museum.” As of 2015, with
the support of Turkcell the museum
introduces visitors to an alternative
world, accompanied by visually impa-
ired and hearing-impaired guides. As
part of the project, nearly 50 visually
and hearing-impaired individuals have
been employed in Istanbul with the
support of Turkcell.
Disaster response
In 2020 we met our responsibility of
Connect the World with Books
With the cooperation of Turkcell
supporting our country and people
Corporate Communication and Con-
during natural disasters. We provided
sumer Sales Commercial Marketing
grant support to 350 tradesmen and
Teams, a total of 140 thousand books
200 families in Giresun, where flood-
spanning 30 genres of Turkish and
ing occurred in August. The support
World Classics, were distributed as
to tradesmen, whose premises were
a semester holiday gift to all children
damaged, and to affected families,
who visited our 181 stores in 24 cities
has been provided via Paycell cards
in Eastern and Southeastern Anatolia.
Our activities to increase
social digital literacy
We run various training activ-
ities to make Turkey a leader
in software devel-
country
opment and digital transfor-
mation. In order to improve
people’s lives with technology
and contribute to realizing the
dreams of our society, we work
to eliminate the inequality of
opportunity, financial barriers,
inadequate resources, and lack
of role models.
Accordingly, we have made an addi-
tion to Turkcell’s equality of opportu-
nity projects carried out to encourage
children to spend more productive
and entertaining semester holidays.
issued on their behalf.
Our Helping Hand to Giresun through
Paycell project also marks a first in
terms of our digital services being
used for providing aid purposes dur-
ing a disaster. Meanwhile, we created
a special communication package
to support search and rescue teams
that rescued dozens of people from
the rubble following October’s earth-
quake in Izmir. Immediately after the
earthquake, we identified a free call
and internet package to meet the
emergency needs of our customers
in the disaster area, positioning our
12 mobile base stations in the area to
ensure the continuity of communica-
tion, and establishing 6 mobile charg-
ing stations in those locations most
affected by the earthquake.
Turkcell Dialogue Museum visitors
2018
2019
2020
Short-term
target
Mid-term
target
Long-term
target
52,500
54,500
10,000
72,500
65,000
75,000
Turkcell video call center
The Face-to-Face Customer Ser-
vice channel of Turkcell and Su-
peronline began to offer video
services as of March 1, 2019 to
foster social support. In May 2020
we also added our BiP channel to
our service initiated over Turkcell
Digital Operator and My Sign Lan-
guage applications back in 2019.
This innovation also facilitates the
lives of hearing-impaired custom-
ers. Customers can access Face-
to-Face Customer Service from the
Digital Operator, as well as Sign
Language, BiP applications, Turk-
cell and Superonline stores, and re-
ceive service in sign language be-
tween 10:00-01:45 each day of the
week. Hearing-impaired customers
can use the service free of charge.
As part of the service model, ex-
ternal calls and call-backs to cus-
tomers can be performed by call
center representatives. Customers
can reach out to the call center
by clicking the link in the message
once an SMS is sent.
Turkcell serves
approximately 3
thousand hearing-
impaired customers
per month over the
video call center.
Turkey’s Largest Software Plat-
form: Turkcell Developers of
Future
We provided Python training ses-
sions with Microsoft SQL Server,
Data Literacy, Data Science, and an
Introduction to Artificial Intelligence
through our Developers of the Fu-
ture platform in 2020. Furthermore,
2D Mobile Game Production with
C# over Unix Game Platform, Data
Visualization, Data Manipulation,
Data Pre-processing, Statistics for
Data Science, Big Data and Data
Science Project Management train-
ing had been published on the Unix
Game Engine. In addition to tech-
nology training, Turkcell provides
everyone the opportunity for devel-
opment with Digital Literacy Train-
ing regardless of age and know-
how level.
Turkcell Developers of Future Program
Number of certificates received
from the Developers of the
Future platform
Number of users reached
by Developers of the Future
trainings (million)
2018
2019
2020
6,542
13,755
83,000
5.0
6.4
7.5
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TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
200
Women Engineers who
Develop the Future
In 2020, we organized
the
Women Engineers who Develop
the Future project. Within this
scope, we received 4,131 appli-
cations and reached 101 Tech-
nology Camp participants. The
project will continue over the
coming years
SDG 4.3, 4.4, 4.5
SDG 5.5, 5.B
SDG 8.3
SDG 10.2
Turkcell’s kids code the future
Through this project, we help children
aged between 7-18 to develop cod-
ing skills through Scratch and AppIn-
ventor trainings. Thereby, our children
learn coding and acquire competenc-
es for the future.
Digital Literacy Program
We continue to disseminate our “Dig-
ital Literacy” training through various
channels to advance the increasing
digitalization experience of
those
middle-aged adults who have yet to
encounter the digital world, especially
during the pandemic period. Initially,
we aim to bring the content to a wid-
er audience via television broadcast
on TV+.
Recycle into Education
Thanks to the “Recycle into Education”
social responsibility project imple-
mented with the support of Turkcell
to monitor electronic waste across
Turkey, many unused devices ranging
from computers to satellite receiv-
ers, and from telephones to audio
systems are collected in the techno
waste containers located at Turkcell
stores, contributing to the improve-
ment of children’s lives.
Together with TÜBİSAD, Turkcell has
channeled 6.5
tons of electronic
waste collected since the first day of
the project into the economy. While
all related income was donated to
TEGV (Education Volunteers Founda-
tion of Turkey) to be used for the ed-
ucation of children, starting as of the
new semester in the reporting period,
the income is now donated, through
KAHEV (Women Physicians Education
Support Foundation), to the children
of healthcare professionals who lost
their lives during the pandemic.
In addition to the social value
we created through the
Recycle into Education Project,
we contribute to our natural
capital. You can access more
information on this in our natural
capital section.
Limitless Talent
Within the scope of Turkcell Limitless
Talent Program, developed by Turk-
cell Academy and lasted 10 weeks,
10,010 young people had the op-
portunity to experience Turkcell for
a week. Limitless Talents, who have
the chance to get to know the busi-
ness unit of their interest, work and
learn together, participate in vari-
ous online trainings and live training
sessions. 3,440 Limitless Talents who
successfully completed the “Turkcell
Academy Future Ready Certificate
Program” received their certificates
from Turkcell Academy to prepare
them for the competencies of the
new world.
Our sponsorship projects
Our support for sports
and arts & culture
We continue our pioneering
efforts for the development
of culture, the arts and
sports in Turkey so that our
artists and sportspeople can
be acclaimed in national
and international arenas.
National Football Team
Sponsorship
Turkcell has been the main sponsor
of the Men’s and Women’s A Nation-
al Football Teams since 2005 and the
“Official Communication Sponsor”
since 2002. Our A National Team,
which we have proudly support-
ed for 18 years, is representing our
country in Euro 2020. We continue to
support our Men’s and Women’s Na-
tional Teams for the development of
Turkish football, and expect them to
make our country proud again with
fresh successes in international tour-
naments.
Turkish Sports Federation for the
Physically Disabled
We have deepened our collabora-
tion with the Sports Federation for
the Physically Disabled, that started
with football back in 2016, thereaf-
ter expanding to 18 disabled sports
branches (amputee football, basket-
ball, shooting, arm wrestling, archery,
swimming, sailing, tennis, badminton,
athletics, sitting volleyball, table ten-
nis, weightlifting, boccia, skiing, danc-
ing, curling, and fencing) and 7,514
disabled athletes. Our physically dis-
abled athletes made us proud win-
ning 92 medals in total, including 28
gold, 32 silver and 32 bronze medals,
in international tournaments in 2020.
Furthermore, 26 disabled athletes, in-
cluding 6 table tennis players, 1 ath-
lete, 6 shooters, 7 archers, 4 swim-
mers and 12 wheelchair basketball
players, have qualified to attend the
Tokyo Paralympic Games.
Athletics - Swimming Project
We continue at full speed the Ath-
letics and Swimming Performance
Projects that we kicked off in 2013,
and that involve a TRY56 million
sports investment, in collaboration
with the Turkish Athletics Federation
and Turkish Swimming Federation.
We have provided the greatest and
longest-term support for amateur
sports in Turkey to date through
these projects. We work together
on many issues with the Federa-
tions such as applying innovative
and modern management models,
expanding the young athlete pool,
ensuring continuous elite athlete de-
velopment, and organizational and
technological development.
Turkish athletics and swimming,
main sponsor of which is Turkcell,
continued registering successes in
the 2020 season.
Our national athletes won 161 med-
als in total, 123 in athletics and 38 in
swimming, in the international are-
na, despite the late-opened season
due to the pandemic. Thirteen of our
athletes and 5 swimmers have met
the requirements to attend the 2021
Tokyo Olympics and will represent
our country.
In addition to these successes, in
2020, the number of licensed swim-
mers reached 203,796 and the num-
ber of active swimmers reached
11,868, while the number of licensed
athletes reached 246,648 and the
number of active athletes reached
31,583. We continued our support for
the success of our athletes through
30 athletics and swimming tour-
naments organized for various age
groups in different categories across
Turkey, under the Turkcell name.
Medals won in 2020, with Turkcell’s sponsorship
Number of
medals in
Paralympics
28
GOLD
32
SILVER
32
BRONZE
Number of
medals in
Athletics
40
GOLD
41
SILVER
32
BRONZE
Number of
medals in
Swimming
11
GOLD
11
SILVER
16
BRONZE
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Our social values and relationsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
Turkcell Platinum
Bosphorus Cup
Turkcell Platinum Bosphorus Cup,
among Turkey’s key sporting organi-
zations in the international arena, saw
its 19th outing this year. We broadcast
the race live via the Turkcell Plati-
num application with exclusive foot-
age. Fifty sailboats and close to 500
sailors attended the race that we
organized in compliance with pan-
demic rules. In 2020 we reached 25
million people through communica-
tion activities realized through digital
platforms and the media regarding
the Turkcell Platinum Bosphorus Cup.
Zorlu Performance Arts Center
As part of our venue sponsorship since
2018, the main theater stage at Zor-
lu PSM hosts world-famous perfor-
mances and shows under the name of
“Turkcell Stage”. The theater stage at
the center welcomes art lovers as the
“Turkcell Platinum Stage”. All cultural
and arts events such as musicals, con-
certs and theater plays are performed
on stages hosted by Turkcell. Thanks
to our cooperation, Turkcell Platinum
customers, who enjoy comfort and
privileges in all areas of life, have the
opportunity to win exclusive tickets for
Zorlu PSM events. Paycell customers
who buy their tickets with Turkcell’s
new generation payment platform
Paycell Card enjoy the privilege of fol-
lowing many events at Zorlu PSM with
discounts. We have hosted 7 hundred
thousand visitors at over 1,200 events
since 2018. We have continued our
support during the pandemic peri-
od, standing by art lovers with online
events.
202
Turkish Federation of Traditional
Sport Branches
The Federation, which we support as
the main sponsor, consists of 247 clubs
in 64 provinces, and over 20 thousand
athletes, 351 trainers, 1,700 referees,
and is active in the following branches:
equestrian, javelin, ambling, horseback
archery, aba wrestling, salwar wres-
tling, belt wrestling, traditional sleigh,
sleigh and kokboru. The objective is to
successfully showcase our ancestral
sports, especially at national and in-
ternational level, to increase their rep-
utation and secure future success; and
we aim to raise healthy, active and
successful young people in our society
by creating opportunities to increase
the presence of these sports branches
specific to our culture.
Trabzonspor 5G infrastructure
collaboration
We signed a 3-year agreement with
Trabzonspor, a Super League club,
starting from the 2019-2020 season.
Within the scope of the agreement,
we established a 5G infrastructure
at Trabzonspor’s home ground in Ak-
yazı. We delivered Turkey’s first 5G live
broadcast from the stadium ahead of
Trabzonspor’s league match against
Fenerbahçe. We will continue contrib-
uting to the digital transformation of
sports clubs and sports broadcasting
in the upcoming period.
Turkey Athletic Talent Screening
and Orientation to Sports Project
As of 2018 we have become the of-
ficial sponsor of the Turkey Athletic
Talent Screening and Orientation to
Sports Project, executed in collabo-
ration with the Ministry of Youth and
Sports and the Ministry of National Ed-
ucation. We aim for the participation
of 1 million primary school students
at 3rd grade in our project each year.
While we ensure the participation of
4 thousand students in the profession-
al athletes pool annually through the
project, we encourage children unable
to enter the athletes pool, to continue
their sports activities by directing them
to Provincial Sports Center activities.
Sabancı Museum
Considering culture and the
arts among the core values of
Turkey, we became the Com-
munication and Technology
sponsor of Sakıp Sabancı Mu-
seum in 2014 to support and
celebrate the value created.
We will continue to increase
our support in this area.
GNÇ Star Music Competition
Over 2 thousand candidates have
applied to the GNÇ Star Music Compe-
tition, which we organized to support
young musicians. More than 25 thou-
sand users rated the performances of
the competitors through the GNÇ app-
lication. The performances of the top
10 finalists were evaluated by celeb-
rated artists Ferman Akgül and Fatma
Turgut during the live broadcast on the
GNÇ YouTube channel.
The digital finale, followed by hund-
reds of thousands of people, gene-
rated great interest. Famous stars not
only evaluated the 10 finalists, but also
shared memories of their own musical
journey, as well as inspiring stories for
young musicians.
2020 İşTurkcell
Technology Meetings
We marked another first through our
İşTurkcell Technology Meetings event.
Held with the theme of “How Close
are You to the Digital Technologies
that Grow Your Business in the Digital
Age?”, over 1,000 people attended our
panels where we discussed the topic
covering various businesses and sec-
tors.
With our customers having the oppor-
tunity to be informed on our products
one-to-one at our booths, an average
of 800 visitors entered each of our bo-
oths during the day, with 200 custo-
mers participating in the game setup.
Turkcell Platinum Park
With Turkcell Platinum Park, opened
in 2018, we offer our customers and
society the opportunity to escape the
monotony of urban life. As part of the
project realized in step with our goal
of happy customers, we have provi-
ded discounts and benefits to approxi-
mately 50 thousand Turkcell Platinum
customers for off-road, archery and
restaurant related use since 2018.
203
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Sectoral supports
As Turkcell, we aim to be the pio-
neer of diverse sectors along with
the telecommunication sector it-
self, to follow innovative approach-
es and to contribute to the devel-
opment of the respective sectors in
question. In this context, we spon-
sor many congresses and confer-
ences on diverse subjects such as
HR applications, digital marketing,
supply chain management, avia-
tion and space technologies, cyber
security, and technology solutions.
Our sponsorships bring us together
with various target audiences such
as entrepreneurs, students, inves-
tors, NGOs and public representa-
tives, academics, white-collar em-
ployees, and the middle and senior
managers of corporations. In 2020,
we continued to support activities
carried to digital platforms due to
the pandemic. We had the oppor-
tunity of reaching millions of view-
ers, and we convey our messages
through over 50 congresses and
conferences throughout the year.
Our social values and relationsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
204
Contribution to exchanging
knowledge and experience
across all stakeholders
We determine the expectations
of our stakeholders as inclusi-
vely as possible, in light of the
social groups that our services
and activities impact. We make
a collective contribution to the
development of the technology
sector and create value toget-
her in line with our vision of sus-
tainable communication. Due
to our leader position in digital
transformation, we consistently
exchange knowledge and infor-
mation with our stakeholders by
collaborating with NGOs, inter-
national organizations, startups,
and universities.
SDG 17.16
SDG 16.7
You can access more
information about our
stakeholder relations in
the interactions with our
stakeholders section of the
report.
United Nations Global Compact
(UNGC)
The UNGC, with Turkcell being among
its first signatories, organized an on-
line interview event with the partic-
ipation of academicians and direc-
tors of signatory public institutions,
companies and NGOs as part of their
20th anniversary activities. Turkcell’s
CEO Murat Erkan participated in the
exclusive interview series organized
on the occasion of the 20th anniver-
sary of UNGC via the remote meet-
ing solution, BiP Meet, developed by
the communication and life platform
BiP. He talked about how Turkcell has
adapted the 10 principles of UNGC
to company policies and strategies,
as well as the future sustainability
targets of Turkcell. Furthermore, as
the sole Turkish representative on the
GSMA board, our CEO also shared in-
formation on sectoral developments
in our country.
United Nations Global Compact
CFO Taskforce
The CFO Taskforce initiative has been
established by the UNGC, the preem-
inent global corporate sustainabil-
ity effort, with Turkcell being among
its founding members. The initiative
brings the worldwide CFO communi-
ty together within the framework of
sustainability.
You can access more
information on the UNGC CFO
Taskforce in the financial capital
section of the report.
that guide
Being the leader and pioneer
company in our sector and
country through representations
GSMA
We are among the 800 GSMA mem-
ber organizations
the
global mobile communication sector.
In addition to sharing Turkcell’s na-
tional and international experiences
on global platforms, we contribute
to the use of mobile technologies for
social benefit and support the digital
economy via mobile platforms and
the development of new generation
communication technologies on the
GSMA roadmap.
GSMA Sustainability Network
Moreover, we continue our contribu-
tion to the transition of the interna-
tional telecommunication sector to-
wards SDGs, through participation in
the activities of the GSMA Sustaina-
bility Network, a sub-organization of
the GSMA.
We were the first operator to provide
“Sustainable Business Development”
trainings to its employees. As part of
the key role mobile operators play in
the sustainable business world, we
aim to advance our sustainability
strategy for social and environmen-
tal benefit, reflecting this in the way
business is conducted today, and en-
abling our employees to acquire new
skills through this training.
We were the first company in Turkey
to sign the GSMA Accessibility Prin-
ciples. Additionally, we were among
the first 8 companies in the world to
do so. In being a signatory to these
principles, we pledge to design and
develop all Turkcell platforms for our
disabled customers and employees
according to globally accepted ac-
cessibility standards. As Turkcell we
will continue to provide more equal
and accessible services and increase
the number of accessible products
and solutions with the assistance of
all Turkcell units, in the awareness that
disabilities arise from social barriers.
Our public affairs
We are the operator with the most
robust mobile network operating on
the widest spectrum. We play a le-
ading role in Turkey’s technological
transformation with 50 thousand ki-
lometers of end-to-end fiber infrast-
ructure and world-class data centers
that enable us to provide superior qu-
ality services. We act in accordance
with the tax and legal liability related
regulations that we are bound by.
With our exemplary corporate citizen
identity, we have contributed over 44
billion Turkish Liras of tax and legal
obligations related payments to the
public since 2015.
Turkcell and Turkcell Group compa-
nies are subject to a great number of
regulations, and our companies also
deal with many public institutions in
line with their fields of activity. The
regulatory frameworks that concern
Turkcell’s main field of activity and
the activities of Group companies di-
rectly and fundamentally affect the
technical and commercial operations
of our companies, as well as service
delivery, and the framework of their
relations with stakeholders.
We collaborate with the relevant ins-
titutions in the consultation, develop-
ment, and implementation processes
of these regulations. As Turkcell, we
closely follow all legislative initiati-
ves that concern our field of activity.
By analyzing the regulations in terms
of legal, technical, commercial, ope-
rational, and economic aspects, we
communicate our opinions and sug-
gestions to the public. Moreover, we
closely follow legislative works car-
ried out by relevant public instituti-
ons and organizations, and disclosed
for public opinion within the relevant
NGOs, and contribute to the shaping
of regulations through position papers
prepared accordingly. SDG 16.7
SDG 17.16
Business Council for Sustainable
Development Turkey (BCSD Turkey)
The Business Council for Sustainable
Development Turkey (BCSD Turkey),
the regional partner and part of the
World Business Council for Sustaina-
ble Development (WBCSD), exchang-
es its sustainability experience among
members on
various platforms
through working group activities.
As part of our collaboration with the
foundation, we set our initial activity
areas as circular economy, sustain-
able finance, the future of business
with technology, net-zero carbon and
women employment. In this context,
Korhan Bilek, on the finance side and
Erkin Kılınç, the CEO of Turkcell Enerji
represent our Company on this plat-
form. As part of the foundation’s ac-
tivities, we are a member of the Tur-
key Materials Marketplace and a sig-
natory to IPG (Business World Plastic
Initiative). As a signatory to IPG, our
commitment to reducing the use of
plastics is ongoing.
Mobile Telecommunications
Operators Association (m-TOD)
The Mobile Telecommunication Oper-
ators Association was established in
June 2016 by the three authorized op-
erators of the sector to create activ-
ity areas for the solution of common
problems, and to take initiatives at all
stakeholder levels to implement those
solutions. With the platform, of which
Turkcell is among the founding mem-
bers, we aim to directly contribute to
pioneering an ethical, proactive, and
competitive mindset in the Turkish tel-
ecommunication services sector.
You can access the details of
other national and international
sector representations in the
measuring the created value
section, Appendix-2: National
and international organizations
and non-governmental
organizations and Appendix-3:
Our Board of Directors
memberships.
2020 Ambassadors
Summit
12th Ambassadors Con-
The
ference, which this year took
place in the digital environment
as a COVID-19 precaution, was
held on the video conference
platform BiP Meet, developed
by Turkcell engineers. Turkey’s
President Recep Tayyip Erdo-
ğan met with ambassadors
serving at 149 locations abro-
ad at the 12th Ambassadors
Conference organized by the
Presidency of Turkey and the
Ministry of Foreign Affairs un-
der the auspices of the Digital
Transformation Office.
You can access the details of
2020’s significant legal and
regulative developments in the
company and sector developments
section of the report.
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Public health
We manage the effects of our
products and services on public
health by setting limits below
those set by the International
Commission on Non-Ionizing
Radiation Protection
(ICNIRP),
authorized by the World Health
Organization,
in accordance
with national and international
regulations.
You can access more informa-
tion about the effects of our
base stations on public health
in our manufactured capital se-
ction of the report.
With the Hospital Information
Management System we cont-
ribute to the digital transfor-
mation processes of smart city
hospitals, thus supporting the
technological development of
public health.
You can find detailed
information about our
contribution to the digital
transformation process of our
city hospitals in our intellectual
capital section of the report.
The changing dynamics of our age
come with a transformation of pub-
lic services expectations and un-
derstanding. The public institutions,
whose primary mission is to improve
the quality of life in our country, work
to enhance sustainable service qual-
ity with a citizen-oriented approach,
while striving to fulfil this duty at op-
timal cost.
We are aware of the leveraging role
of digital transformation and tech-
nology in this transition. It is now pos-
sible to create a cleaner, more trans-
parent, and more interactive world
thanks to the proliferation of tech-
nologies including smart devices and
broadband internet. Indeed, for this
very reason, Turkcell has embarked
on a journey to build smart cities
and smart municipalities and enable
smart lives with all public bodies and
directors on the basis of its Real-Time
Installation approach, robust infra-
structure, and end-to-end solutions.
Turkey’s Automobile Joint
Venture Group Inc. - TOGG
Turkey’s Automobile Joint Ven-
ture Group Inc. (TOGG) was es-
tablished on June 25, 2018 with-
in the framework of Turkey’s
Automobile Project implement-
ed through the coordination of
the Republic of Turkey Ministry
of
Industry and Technology
and the Union of Chambers
and Commodity Exchanges of
Turkey. As one of the founding
partners of this company with
a 19% shareholding, we aim to
be involved in fields of great
potential such as connected
vehicles, smart cities, and intel-
ligent transportation.
Transparent and proactive
investor relations
As part of Turkcell Investor Re-
lations, we list our fundamental
working principles as accessi-
bility, rapid feedback to stake-
holders, and the transparent,
consistent and timely informa-
tion provision. In accurately in-
troducing Turkcell to our inves-
tors, and analyzing our business
model, risks and opportunities,
we aim to establish a trans-
parent and proactive investor
relations management with a
focus on making a difference
by mastering Turkcell strategies
and effectively communicating
them to investors.
You can access more
information about TOGG in our
intellectual capital section of the
report.
You can find more information
on Turkcell’s transparent and
effective investor relations
management in our financial
capital section of the report.
Value oriented, responsible
supply chain management
The number of
companies starting to
integrate competitive
and beneficial
practices in supply
chain sustainability into
their working methods
to effectively manage
the impacts of their
business models has
been rising rapidly over
recent years. Within
the framework of our
value creation principle,
we re-evaluate each
stage in our supply
chain management
starting from the
materials we use,
including the activities
and practices of each
company in our supply
chain. We classify our
supply chain resources
as information,
material, financial and
workforce resources,
and undertake the
management of each
resource meticulously.
To make our national
and international
supply network as
agile, flexible, and
sustainable as our
direct operations,
we restructure
our main business
processes, logistics
and technologies with
a holistic approach,
supported by our
suppliers.
We ensure the seamless delivery of
our ethical, fair, and honest business
practices with every firm we work
with in our supply chain through our
policies and contracts. We sign a
framework agreement with every
firm we work with and give impor-
tance to compliance with the princi-
ple of opposing forced or compulsory
labor, as well as issues such as em-
ployee rights and prevention of child
labor. Within the scope of the child
labor clause in our framework agree-
ments, we ensure that our suppliers
comply with the rule stating that “The
company should not use child labor.
Unless a higher age limit is specified
in local laws, no one under the age
of 15 who has not completed com-
pulsory education (within the scope
of International Labor Organization
(ILO) convention No. 138) ought to
be employed. Employees below the
age of 18 should not be employed in
jobs that pose danger, or in night-
shift jobs in order to meet their ed-
ucational needs”. We also ensure the
ethical management of our business
processes in line with the rule that
“No employees ought to be forced
to work in any situation. This require-
ment includes the forced prison labor,
labor in exchange of debt with high
interest, or other forms of forced la-
bor” clause to prevent forced labor.
Should any supplier violate the frame-
work agreement and fail to comply
with the requirements of the clauses,
we act according to the relevant legal
clause.
We expect our suppliers to respect all
employer-employee relations with-
in the framework of respecting em-
ployee rights, as part of our Code of
Ethics and our Policy of combatting
Bribery and Corruption as published
on the Turkcell Supplier Portal and
agreed upon by our suppliers.
SDG 8.7, 8.8
SDG 16.5, 16.6
Given that our services directly touch
people’s lives, potential service dis-
ruptions can directly impact the vital
needs of our society such as commu-
nication, health, and security. There-
fore, the products and services offered
to our customers by our suppliers hold
utmost importance. We determine all
the suppliers we work with on the ba-
sis of mutual trust, along with criteria
such as quality-price balance, past
performance, market conditions, and
references. We prioritize those suppli-
er candidates with quality manage-
ment and information security man-
agement certification, who are sen-
sitive to the ecological balance, and
who work within the scope of social
responsibility principles, together with
other basic criteria.
We classify our suppliers according to
the Kraljic Matrix, according to which
we evaluate those with a purchase
volume of above a certain amount
through a survey on quality, and com-
mercial as well as operational issues.
According to the evaluation results, we
take actions such as terminating work
with the supplier, implementation of
supplier improvement measures, or
rewarding the supplier. In our val-
ue-oriented, responsible supply chain
practices, we evaluate the complaint
processes as per contract articles, in
line with the general customer com-
munication channels, or feedback
from the business units, swiftly tak-
ing remedial actions. Through regular
assessments and audits, we evaluate
the compliance of our suppliers and
report them to our Senior Manage-
ment. In 2020, there were no cases
indicating that our supply chain and
suppliers had caused a negative en-
vironmental or social impact, or else
could have a potentially negative one.
As Turkcell Group, we consider our
purchasing management structure
under 4 main categories namely;
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strategy, people, process, and prac-
tice. In all our purchasing processes,
we carry out our activities with a
transparent approach towards our
stakeholders, considering ethical, an-
ti-corruption, and social contribution
aspects. National and international
standards are our compass in making
our purchasing processes completely
transparent. We conduct our purchas-
ing processes in accordance with the
following rules and standards:
• Sarbanes-Oxley Act (SOX)
• Security Exchange Commission
(SEC) Regulations
• Foreign Corrupt Practices Act
(FCPA)
• Capital Markets Board (CMB)
Regulations
• Information and Communications
Technology Authority (ICTA)
Regulations
• Liabilities regarding the Turkish
Code of Commerce (TTK)
• Liabilities regarding the Turkish
Penal Code (TCK)
• Liabilities regarding the Turkish Tax
Legislation
• ISO 9001 Quality Management
System and ISO 27001 Information
Security Management System
• Customs Law No. 4458 and Free
Zones Legislation
• Liabilities regarding other countries
that we operate in (Ukraine,
Belarus, TRNC)
In managing our purchasing process-
es, we adopt cost analysis and dy-
namic working principles.
When assessing
purchasing processes,
we prioritize those
practices that allow us
to save on costs and
use the integrating
power of technology.
The interactions of our
social values and relations
with other capitals
Our social values that shape the
way we do business and our
relationships with our stakeholders
are among our most significant
capitals that guide all other capital
components and contribute to
the strong Turkcell image. Our
social values and relations reflect
in our communications, which
increases Turkcell’s brand value
and reputation. Accordingly, we
realize the vision and mission
underpinning our various capitals
through our statements such
as “Turkey’s data should remain
in Turkey”, “Turkey’s robust
infrastructure”, and “Mobile internet
at Fiber Speed”. We support our
robust financial capital through
high customer satisfaction and
loyalty. And with the awareness
of being a good corporate citizen,
our solid relations with employees,
the public, our suppliers and our
society form the cornerstone of
our Turkcell identity, which creates
value for the long run.
Localization efforts
In terms of supporting domestic and
national digital transformation, nurtur-
ing Turkey’s entrepreneurship ecosys-
tem, and contributing to sustainability;
we carry out Category Localization
Activities, Supplier Relations, Tek-
nokent Relations and Entrepreneur
Assistance Programs (My Great
Partner Program), the efforts of At-
tracting Global Investment to Turkey,
the activities of the Trade Attaché,
and all Intra-Company Stakeholder
Coordination activities. Localization
efforts are critical for Turkcell, being
directly related to our relations with
the Local Ecosystem and the ICTA.
In April 2020, we began to work on
the “Turkcell Localization Program”
aimed at running and following-up
processes under a single roof, with
the direct guidance of our Chairman
and the CEO. The main categories
to be followed in the short, medium
and long-term have been designated,
with localization potential noted at
meetings held at senior management
level. The studies carried out on the
In 2020, we updated our standard
purchasing processes to support
startup companies. Our Domestic
and National Industrial Relations
team visited techno parks, pro-
moted our new purchasing model
and encouraged the ecosystem to
participate in the processes.
design of localization methodologies
for these categories involve expert
teams considering both demand and
purchasing aspects.
SDG 9.B
Our localization
framework ensures that
purchased products
are produced in
Turkey and purchased
services are delivered
by a local workforce.
The localization rate
of our main suppliers,
which corresponds to
approximately 90%
of our total purchase
volume, has been
realized at 36.1% in
2020.
As of the end of November 2020,
with the My Great Partner Pro-
gram we have generated a pur-
chase volume of TRY14.7 million
with 30 companies affiliated to 17
techno parks across 10 provinces.
Number of startups working with the cooperation model
2019
2020
Short-term target
Mid-term target
6
30
30
40
Supplier Oriented Innovation Projects
The Supplier Oriented Innovation (SOI)
is a program encouraging suppliers to
leverage their innovative potential for
company benefit. Turkcell currently
works with 1,500 suppliers and has a
total of 5 thousand suppliers managed
within its ecosystem. These suppliers
serving Turkcell also provide similar
services to many different companies
on a local and global scale. Suppliers
can be informed firsthand of any in-
novative development in their field of
work at the companies they serve.
At the same time, suppliers are able
to notice the differences in business
practice among different companies
to which they provide the same ser-
vice, and thus assess the efficiencies
as well as inefficiencies regarding that
business. The SOI program aims at
being informed of global innovations
in those fields in which we work with
suppliers, and to evaluate the potential
for suppliers to access innovations.
To encourage
innovation, additional
rights and advantages
are given to suppliers
and our employees
who work in innovative
project teams. The
projects were evaluated
by the Committees
established at the Vice-
Presidential level. A total
of 47 ideas had been
submitted by the end
of 2020. Seven ideas
were brought to the
committee, 6 of which
were implemented.
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Natural
capital
215
Climate crisis management
219
Energy management
220
Renewable energy
212
Natural capital
Natural capital
Inputs
Outputs
Value created
Natural resources management
• Energy efficiency
• Efficient resource use
• Waste management and circular
economy
• Using IoT applications to increase
natural resource efficiency
Renewable energy investments
and project
• Turkcell Energy investments
• TRNC Solar Power Plant
• Portable Solar Field Project
• Solar panel installations on roofs
19,409.38
t CO2e
Scope 1 emissions
6.5 tons
of electronic waste
recovered with
Recycle into
Education
0.2%
renewable energy share
in energy consumption
Outputs
63,699.52
t CO2e
Scope 3 emissions
1.6 million
kWh installed total
renewable energy
power
440,938.58
t CO2e
Scope 2 emissions
165.5 million
kWh savings with
energy saving
practices
154,057 m3
annual total water
consumption
Renewable electricity consumption ratio
Annual energy savings
Responsible use of resources
Improving carbon performance
• Reduced Scope 3 emissions with remote working
Contribution to reducing the environmental impact
of customers
• Carbon emissions per petabyte
Financial value created through sustainability activities
Rising energy and resource consumption due to
Turkcell’s growing operations
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Fight against climate change
and effective energy management
We plan the use of
our natural capital
by considering the
balance of the
natural ecosystem
and the needs of
future generations,
aiming at the effective
management of
our environmental
performance.
We take various
initiatives to reduce
the environmental
impact of our
operational activities
while improving our
business processes
in accordance with
sustainable innovation
principles. We include
our employees
and their families,
suppliers, investors,
and customers in this
process.
Fight against climate
change and effective
energy management
Our senior management,
having adopted the fight
against climate change as
one of its agenda items,
holds the responsibility of
supervising our sustaina-
bility activities, which we
carry out in accordance
with Sustainable Develop-
ment Goals and integrate
into our operations.
While conducting our op-
erations, our thinking is to
implement new projects
that minimize our environ-
mental impact, create na-
ture friendly business pro-
cesses, train employees on
environmental awareness,
technologies,
use clean
offer solutions to custom-
ers and other stakehold-
ers for a more sustainable
life, conduct research into
environmentally-friendly
products and services and
conserve the ecological
environment.
We adopt an approach
that focuses on the effec-
tive use of natural resourc-
es across our value chain,
utilizing renewable energy
resources as part of effi-
cient energy management
practice.
Our business model and sustainability
strategy aim to transform our use of
natural resources into social and eco-
nomic value, prioritizing the manage-
ment of environmental impacts during
this transformation. We focus on un-
derstanding, managing, and reducing
our impacts, aware of the close re-
lationship between our business and
natural capital. As Turkcell, we strive
for the sustainable management of
our operations, increasing efficien-
cy and maximizing the value gained
from our natural capital. We comply
with national environmental regula-
tions. In 2020, there were no filings
against Turkcell by regulatory and su-
pervisory bodies with respect to leg-
islative misconducts, or complaints in
relation to environmental issues.
COVID-19 note
With the spread of the CO-
VID-19 pandemic, the Turkcell
family switched to a remote
working model. Subsequently,
we observed that this model
had various impacts on ener-
gy use both in the short- and
long-term. Although the long-
term effects of remote wor-
king on energy use and carbon
emissions are still uncerta-
in, during this period we had
the opportunity to reduce our
emissions as energy consump-
tion in our offices declined and
our business travels were limi-
ted in scope. The rising use of
online platforms that we have
developed, such as Paycell, has
enabled significant savings in
resource consumption.
In 2020, our Company organized
competitions with awards for en-
its
vironmental friendliness among
employees in light of sustainabili-
ty improvements in current business
practices. In addition, a business unit
focused on sustainability was estab-
lished with KPIs related to corporate
sustainability assigned to its employ-
ees. In 2021, a target including ESG
issues was added to our Company’s
business goals, and a methodology
was created using ESG parameters to
assess employee performance.
it
impact,
While Turkcell reports processes of
environmental
includes
those elements of indirect environ-
mental impact in various reports (ISO
14064 Greenhouse Gas Calculation
and Verification Management Sys-
tem - CDP Climate Change Reporting
etc.). It develops projects and good
practices for those indirect impacts.
It has developed various projects re-
lated to customers’ electronic waste,
or employee waste. In 2021 it has for-
mulated plans to report the emission
items not reported within Scope 3
emissions in the upcoming periods.
Turkcell purchased carbon credits to
offset carbon emissions caused by
Activity
Heating (natural gas)
Generator (diesel)
Fleet cars (gasoline + diesel)
Refrigerant gas filling*
Fire extinguisher refilling
Purchased electricity
the printing of the 2020 integrated
annual report. Details of the offsetting
process can be followed using the QR
code on the back cover of our report.
Climate crisis management
Emissions management
In order to manage the climate crisis
effectively, the monitoring and report-
ing of our greenhouse gas emissions
generated as a result of our activities
are among our main environmental
priorities. In this regard, as the first
mobile operator in Turkey we fulfill
our responsibilities with ISO 14064-1
Corporate Greenhouse Gas Emis-
sions Calculation and Reporting Cer-
tification. We monitor our Scope 1,
Scope 2 and Scope 3 greenhouse gas
emissions resulting from our activities
through calculations made using the
IPCC Tier 1 and Tier 2 (electricity) ap-
proach, covering CO2, CH4, N2O and
HFC gases. In our ISO 14064 Calcu-
lation and Reporting of Greenhouse
Gas Emissions audits, we include the
use of personnel shuttles within the
scope of our direct and indirect en-
ergy consumption and other indirect
emissions, as well as waste gener-
ated, transmission and distribution
losses in the electricity network, our
logistics operations, and emissions
arising from the production of energy
that we consume.
As the first mobile operator to hold
ISO 50001 and ISO 14064 certifica-
tion, we strive to have all ESG pro-
cesses verified by independent third
parties.
Regarding the reporting of our emis-
sions, we receive external audits in
every reporting period from an inde-
pendent party for our Scope 1, 2 and
3 greenhouse gas emissions as per
ISO 14064 requirements. In addition,
since 2014 we have annually reported
our emissions transparently through
the CDP Climate Change Program to
meet the information requirements
of our stakeholders. Our base year
for greenhouse gas emission calcu-
lation is determined as 2016 in terms
of data integrity and consistency of
scope. It is determined that 2016 was
the most appropriate year for Turkcell,
where direct and indirect emissions
are comprehensively monitored, and
where data is compliant with the re-
quirements and completeness princi-
ple. There is no activity related to the
burning of biomass within our opera-
tional boundary.
Scope
t CO2e
Scope 1
19,409.38
Consumption
amount
545,182
1,865,001.95
1,626,596
3.2056
0.9552
Unit
Sm3
lt
lt
ton
ton
865,100,351.53
kWh
Purchased natural gas (central heating)
467,542
Sm3
Scope 2
440,938.58
Heating and backup power generation (generator)
Personnel shuttles
Waste generated
Logistics
Production of consumed energy (gasoline + diesel)
Production of consumed energy (natural gas)
1,288,100
375,048.23
lt
lt
3,647.38
ton
323,578
3,491,597.95
lt
lt
545,182
Sm3
Electric transmission and distribution losses**
865,100,351.78
kWh
* Our refrigerant types are R410A, R134A, R22 and R407C.
** Calculated proportionally using the total purchased electricity amount.
Scope 3
63,699.52
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Natural capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
216
Natural capital
We also take innovative steps
in sustainable
finance. With
the “Sustainability Linked Loan”
agreement signed with BNP Par-
ibas and the “Green Loan Agree-
ment” signed with ING in 2020,
we expand our sustainability
approach to financing activities.
With the utilization of these sus-
tainable loans, we fulfill our en-
vironmental responsibilities while
reducing our financing costs.
Total greenhouse gas emissions* (t CO2e)
2018
2019
2020
54,453
108,025
19,409
384,341
383,988
440,938
65,607
80,627
63,699
Scope 1
Scope 2
Scope 3
You may find the details of our
sustainable financing activities
in the financial capital section of
the report.
In 2020, 31 million downloa-
ds were made on our Dergi-
lik application that enables
access to newspapers and
magazines via a single digital plat-
form. Based on the number of pages
of an average publication, the total
number of pages accessed by the-
se downloads is 560 million. Thus, in
2020, Dergilik users preserved close
to 152 thousand trees, supporting the
reduction of carbon emissions. We
expect the positive environmental im-
pact we create through the Dergilik
application to continue growing with
the rising use of digital publishing.
The “Turkcell Kopilot” app-
lication offers a new di-
mension to the car driving
experience with superior
features. It indirectly leads to a redu-
ction in gas consumption through the
analysis of gas usage, the route ta-
ken, and the driver. With this applica-
tion we help companies manage their
fleet with an environmentally-friendly
approach.
* External verification was completed on 24.02.2021 as per ISO 14064-3 Standard by TSI. You can access
the certification via the link.
The Turkcell greenhouse gas emissions intensity ratio for 2020, including Direct
(Scope 1) and Energy Indirect (Scope 2) Emissions was calculated as 143.59 ton
CO2e/Petabyte. The intensity metric for GHG emissions intensity is defined as
“2020 Turkcell Turkey’s emission per petabyte”.
Carbon emission per petabyte* (t CO2e)
306.41
2018
239.79
2019
143.59
2020
*The ratio of total Scope 1 and Scope 2 carbon emissions to mobile network
data traffic (Superonline carbon emissions and Scope 3 emissions is excluded.)
We developed a biometric signature
practice for contracts signed with
landlords as part of the field rental
process. We adopted a digital con-
tract management system allowing
end-to-end digital data entry instead
of a process based on physical ex-
change of contracts, which reduced
the number of required steps from
13 to 5. We can now complete the
field rental process, which previously
took 3-10 days, in a single day. With
the adoption of this new practice, to
date 1,075 contracts have been signed
with biometric signature, thus leading
to savings on paper consumption, ar-
chiving, cargo, and fuel costs.
Having preferred hybrid vehicles over
diesel vehicles in our company car
fleet, we aim to achieve a 35 to 40
gram lower CO2 emission per kilome-
ter. Accordingly, we target preventing
approximately 960 tons of CO2 emis-
sions annually.
We develop our sustainability strat-
egy and goals by taking climate
change scenarios and SDGs into con-
sideration. Reflecting our recently set
goal of becoming a carbon neutral
company by 2050, we determine car-
bon price based on offers collected
from our solution partners in the mar-
ket to offset the emissions from our
operations. The unit price of carbon
varies between EUR0.5 and EUR1 per
ton. In the upcoming periods, we plan
to create an internal carbon pricing
plan to offset some of our Scope 3
emissions. Within the scope of this
plan, we aim to offset carbon in areas
such as business travel and corporate
communication events. Meanwhile,
we aim to raise employee awareness
of the impact of our activities, and ex-
pect it to trigger behavioral change.
Water management
We attach importance to responsible
water consumption within the scope
of our activities, with water being
among the most vital natural resourc-
es. As part of our exemplary corpo-
rate citizenship approach, we take
steps to reduce our water consump-
tion through sustainable water man-
agement, which we hold among our
leading environmental responsibilities.
Although water is not a resource that
we directly use in developing our
products and services, as a responsi-
ble company in terms of resource use,
we disclose the amount of water we
use through our annual disclosures.
Our water demand arises from the
daily general water use of our em-
ployees at the locations where we
conduct our operations. In our Data
Centers, we reuse rainwater as gray
water (in toilets and urinals) with var-
ious filtering processes. We continue
our efforts to recycle and reuse our
wastewater.
Total water consumption (municipal water)
105,958 m3
2018
236,357 m3
2019
154,057 m3
2020
While we strive to improve the
water performance within our
operations, we also support our
customers in managing their wa-
ter consumption with the solutions
we offer. Our Smart Water Meter
platform solution, which allows
meters to be read and valves to
be opened/closed remotely lev-
eraging IoT technologies, helps
control water consumption, en-
abling instant monitoring of wa-
ter use and protection of natural
resources. We offer our “Filiz”
application to farmers in order to
protect scarce water resources
and support sustainable agricul-
tural activities. “Filiz” communi-
cates critical information such as
plant development, water need
and disease risk to farmers, en-
abling them to take necessary
measures. “Filiz” collects this in-
formation by monitoring various
soil and air parameters through
sensors and incorporating them
into algorithms created with ar-
tificial intelligence. “Filiz” is also
noteworthy for its ability to reach
agricultural engineers
through
digital channels. Almost half of
the farmers in Turkey lack access
to technical support. In this re-
gard, we enable access to tech-
nical information for those who
need it, through digital channels.
Integrating
these capabilities
with technology, we support sus-
tainable agriculture.
Waste management
We manage waste resulting from our
operations and activities by selecting
appropriate methods and technolo-
gies. Having adopted the approach of
generating minimum waste and and
maximum recycling, we conduct our
processes in full compliance with rele-
vant regulations through our contract-
ed waste management company.
SDG 12.2
As part of our activities, we integrate
systems that reduce waste generation
and the use of natural resources into
our operations. Furthermore, we sort
waste, the generation of which we
cannot prevent, at its source and im-
plement recycling measures.
We develop practices to reduce the
consumption of materials such as pa-
per and toner in our office buildings,
and sort all types of waste such as
paper, plastic, and domestic waste at
their source. We send sorted waste to
recycling facilities as part of our co-
operation with municipalities and re-
spective authorities.
We collect batteries in waste battery
containers and deliver them to mu-
nicipalities and TAP (Portable Battery
Manufacturers and Importers Associ-
ation) for recycling.
As part of Turkey’s Zero Waste Project
launched nationwide, we have car-
ried out activities since 2018 to limit
waste generation.
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Having established a Waste Man-
agement Center at our headquarters,
solid food waste collected from our
cafeteria and office floors is recycled
by compost machine and turned into
organic soil fertilizer.
We are proud to be
the first company
in Turkey to have
implemented Zero
Waste Project,
even though we
don’t engage in
manufacturing
activities.
Waste generated from our office activities (ton)
Type of waste
Domestic waste
Waste oil
Paper
Medical waste*
Batteries*
Electronic waste*, **
* Hazardous waste
** Being reported as of 2019.
2018
1,249
15.4
84.6
0.243
2.36
N/A
2019
1,286
15.5
83.61
0.261
0.68
0.24
2020
617
11
33
0.08
0.249
0.35
In order to prevent waste oil from mix-
ing with domestic wastewater, we use
oil trap systems. We dispose of haz-
ardous waste such as batteries, toner,
electronics, cables, and consumables
resulting from our operations through
licensed recycling companies having
the required competency within the
regulatory framework. Thus, we pre-
vent hazardous waste from interacting
with the environment.
Within the scope of product reuse,
we sell secondhand devices as well
as other types of scrap to companies
using older technologies. We aim to
revalue 100% of network infrastructure
devices as part of such sales. Hence,
we contribute to the circular economy
system, which ensures that resources
are not redundantly extracted or wast-
ed, but recovered for reuse. As part of
the Modem Renewal Project launched
in 2019, we renew or repair modem
products no longer used by customers
and make them ready for reuse. Within
the scope of this project, 152,024 set-
top boxes (STB), 63,303 Superbox prod-
ucts, 108,368 optical network terminals
(ONT) and 404,431 modems were re-
newed in 2020. Thirty three percent
(approximately 188 thousand) of the
fiber modems used
(approximately
569 thousand) and 60% (approximate-
ly 154 thousand) of the ADSL modems
(approximately 259 thousand) used
in 2020 were sourced from modems
renewed within the year. In addition,
80% of the renewed STBs, 100% of the
ONTs (installed upon determination of
the functionality of ONT products) and
60% of the Superboxes were used in
the same year and brought into the
service of our customers.
SDG 12.2
Secondhand sales and scrap sales volume* (ton)
5,253.25 tons
2018
5,599.89 tons
2019
4,220.18 tons
2020
* 100% revaluation of network related waste as scrap or second hand is aimed at.
We are well aware of the adverse
impact of electronic waste on the
ecosystem if not properly managed.
Hence, we carry out our activities in
this field with the utmost care. In or-
der to convert risk into opportunity, we
utilize products classified as electronic
waste, yet that include rich raw mate-
rials and materials suitable for reuse,
as part of circular economy, thereby
achieving financial savings and effi-
cient use of limited resources.
We started the “Recycle into
Education” project, which is an
electronic waste recycling cam-
paign in Turkey, in cooperation
with “TÜBİSAD (Informatics In-
dustry Association)”. Unused
electronic devices that have
become waste are collected
at Turkcell stores in “electron-
ic waste” boxes. The proceeds
derived from the sale of these
products were donated to TEGV
(Turkey Education Volunteers
Foundation) in previous years.
Starting with the new school
year, we began to donate these
proceeds to the children of
healthcare professionals, who
lost their lives during the pan-
demic, through the KAHEV (Fe-
male Doctors Education Sup-
port Foundation). We recycled
nearly 6.5 tons of electronic
waste in 2020.
As part of the project, we also
recycle the electronic waste of
our employees. With this project,
we not only aim to contribute to
the transformation in education,
but also raise awareness of the
pollution caused by electronic
waste and its potential for re-
cycling. We also continue inten-
sive campaign communications
to raise awareness of the pro-
ject among all our stakeholders.
SDG 12.2
You may find information
about the social benefit we
create through our Recycle into
Education project in our social
values and relationships chapter.
With the environmentally-friend-
ly invoice subscription, which we
established through the Telesales
channel, we reduce our printing
and delivery costs, while signif-
icantly reducing our paper con-
sumption and related environmen-
tal impact.
We carry out all transactions from
new subscription to tariff chang-
es, and from buying a new SIM
card to settling invoices at Turk-
cell stores with a digital signature
on a tablet in just seconds. Digital
signature also makes it possible to
subscribe to services that require
at-home installation for our cus-
tomers such as DSL, Superbox and
TV+. We expect to reduce paper
consumption by 30% while digitiz-
ing approximately 11 million pages
of documents annually with digital
signature. Meanwhile, we enable
companies from all industries to
use the digital signature service.
The smart legal document auto-
mation solution, which we devel-
oped for our legal function that
traditionally sees high paper con-
sumption, helps reduce paper use
and manual processes through ro-
botic process automation. Accord-
ingly, we reduce error risk, while
becoming more environmental-
ly-friendly and operating a more
effective system.
Energy management
We address our energy management
practices from two perspectives;
the energy we consume as part of
our activities and the energy we
produce from renewable sources. As
part of our mission to ensure opti-
mum use of natural resources, and
our environmentally-friendly business
model based on shaping technology
according to social needs, we prior-
itize the use of renewable energy re-
sources. By 2030, we aim to meet all
our electricity needs from renewable
resources. As the first mobile opera-
tor in Turkey, having obtained the ISO
50001 Energy Management System
standard, we make use of every op-
portunity to save energy.
With our Turkcell Energy Solutions
subsidiary established in 2017 as part
of Turkcell Group, we aim to become
a consistent and transparent elec-
tricity energy supplier that operates
within the boundaries of private law
in the competitive environment, in or-
der to supply low cost and environ-
mentally-friendly energy. The value
that we seek to create in this context
is based on leveraging the increased
synergy and activity arising from
the provision of energy, energy solu-
tions, and mobile and fixed benefits
through an integrated approach.
We calculate and monitor our energy
performance via an energy intensity
performance indicator defined as
the ratio of non-renewable energy
consumption to net revenue. The
Turkcell Energy Density ratio for 2020,
including our total energy consump-
tion, is calculated as 76,800 GJ/
Petabyte. The specific measurement
unit used in the energy intensity cal-
culation is identified as “emission per
petabyte.”
219
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Natural capitalTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
220
Natural capital
Renewable energy
As part of our goals of meeting our
entire electricity consumption from
renewable sources by 2030 and be-
coming a net-zero company by 2050,
we pioneer renewable energy invest-
ments by employing the self-con-
sumption model in our buildings. We
therefore target becoming a compa-
ny that generates its electricity from
environmentally-friendly resources.
We plan to meet our
energy requirements
from green energy
sources by having
power plants of our
own and leasing
renewable energy
generation capacity
from power plants in
Turkey with a long-
term approach.
SDG 7.2
SDG 13.1
tainability Gold certification. There
are 64 data centers worldwide and
4 in Turkey that have obtained this
certification. Our Gebze Data Center
was the first in Turkey to receive the
certificate in 2018 followed by our An-
kara Data Center.
We continue to generate electricity
from renewable resources through a
solar energy scheme installed on the
roof of the Turkcell Adana Plaza build-
ing. We utilize the energy generated
through the self-consumption mod-
el to meet the electricity needs of
our Adana Plaza building. We avoid
around 26 t CO2e of greenhouse gas
emissions annually from a 70 thou-
sand kWh electricity generation ca-
pacity.
We generated 1.6
million kWh electricity
from renewables with
3 solar power projects
in 2020. Hence, we
met 0.2% of our
energy consumption
from renewables for
the year.
As Turkcell Energy Solutions, we ap-
proach energy consumption and
generation from an environmentalist
perspective by installing solar ener-
gy power plants at our data centers
and offices, and reducing the carbon
emission within the self-consump-
tion model framework. In 2020, the
electricity generated by the self-con-
sumption model reached an amount
equivalent to the 1-year electricity
consumption of
1,230 households.
Furthermore, we stand to encourage
environmentalist methods
through
electricity trade with renewable en-
ergy power plants. We continue our
environmentalist approach with our
renewable energy supply that is cer-
tificated with I-REC in 2020.
Turkcell Energy Solutions, which will
continue its renewable energy invest-
ments in the coming periods, aims to
make Turkcell a company that sup-
plies its electricity from environmen-
tally-friendly sources with zero car-
bon emissions.
With our group’s first solar power
plant, located in the Turkish Repub-
lic of Northern Cyprus, we generate
1.2 million kWh of electricity annual-
ly, preventing emission of 448 t CO2e
to the atmosphere. With this plant,
we also reduce the demand load on
the TRNC Turkish Electricity Authority
(KIB-TEK) network and contribute to
the digital infrastructure of the elec-
tricity network.
At the Ankara Data Center, the first in
Turkey to generate its own energy via
solar panels, we benefit from solar
power through new generation pan-
els installed on top of the building’s
parking lot, meeting part of our elec-
tricity demand from renewable sourc-
es. We avoided 112.5 t CO2e GHG of
emissions via our data center building
that generates 300 thousand kWh of
electricity a year. In addition, we are
proud to be Turkey’s sole company,
two data centers of which have ob-
tained Uptime OS Operational Sus-
Portable Solar Field solution, which we
developed to meet communication
needs in regions where the popula-
tion increases periodically, but where
access to energy resources is limited,
is a product of our innovation activ-
ities. These communication stations,
installed in various locations across
Turkey, stand out for their environ-
mentally-friendly nature and contrib-
ute to our sustainability goals. We are
proud to share that our investments
into renewable energy technologies
will continue in the upcoming periods.
We design our processes to minimize
the environmental impact not only in
our direct operations, but throughout
our entire value chain. In accordance
with our green procurement practices,
we evaluate the compliance of prod-
ucts we use to various environmental
criteria such as energy efficiency and
the sustainability of raw materials,
and prioritize the use of products of
low greenhouse gas emission.
Turkcell sets short- and long-term
goals to reduce its negative environ-
mental impact, carrying out reporting
and activities accordingly. In 2021, Key
Performance Indicators for renewable
energy and techno waste have been
determined as a business target for
the relevant teams. In 2021, prepa-
rations on the compliance process
of suppliers with the Environmental
and Human Rights Policies published
by Turkcell have begun. The compli-
ance of suppliers with Turkcell’s ESG
processes has also been assigned to
the relevant objectives as business
targets.
We carry out energy saving activi-
ties to ensure responsible use of our
existing energy resources. We attach
importance to the energy efficien-
cy of our network equipment. We
continue to replace air conditioning
devices and energy infrastructure in
data center system rooms with more
efficient, state-of-the-art products.
In calculating our energy savings,
we consider the approximate annual
savings of each field in which saving
initiatives are implemented, and cal-
culate annual savings by taking the
total number of such fields into ac-
count. And in pursuit of achieving en-
ergy savings, we leverage practices
such as fields without air condition-
ing, efficient rectifier technology, pas-
sive cooling, outdoor cabinets, power
saving algorithms, renewable energy
and GPON technology.
SDG 7.3
Amount of total savings through energy saving
activities and projects
114.63
million kWh
2018
139.6
million kWh
2019
165.6
million kWh
2020
The interaction of our
natural capital with
our other capitals
Natural resources,
the supply of which
is limited, is of great
importance in our
sustainable growth
mission. We cover
the effects of our use
of natural resources
through sustainable
and green financing
solutions in our
financial capital. We
ensure that long-term
intellectual property
practices as well as
social and relational
programs that take
natural resources
into account
for sustainable
development are
implemented. We
use our technological
competencies
to produce
environmentally-
friendly solutions and
provide the most
sustainable service to
our customers.
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Appendix-1 Communication channels table
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Appendix-2 Cooperated national, international and non-governmental organizations
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Appendix-3 Board of Directors memberships
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Appendix-4 Turkcell 2020 awards
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Appendix-5 GRI content index table
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Appendix-6 UNGC progress table
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Appendix-7 Sustainability Principles Compliance Framework table
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APPENDIX-1: Communication channels
APPENDIX-2: Cooperated national, international and non-governmental organizations
Stakeholder group
Communication channels
Employees
Suppliers
Internal and External Meetings, C-level Open Door meetings, Assessments,
Announcements, Dashboard, Reports, Awayday, Events, Information Reports, Periodic
Publications and Bulletins
Supplier Management System (2020), Supplier Portal, Internal and External Meetings,
Supplier Days, Cooperation Meetings with SME and Local Manufacturers, Turkcell
Partner Network, Field Rental Owner Meetings, Technopark Meetings
Customers
Media, Turkcell.com.tr, Turkcell and Turkcell CEO Social Media Accounts
Shareholders and investors
Board of Directors Meetings, Conferences, Meetings and Road-show activities, Investor
and Analyst Day Meetings, Quarterly Final Disclosures and Teleconferences on the
Investor Relations Website, Material Disclosures via the Public Disclosure Platform, Annual
and Interim Activity Reports, Frequently Asked Questions Section and Turkcell Investor
Relations e-mail and Phone Lines
Public institutions
and regulatory bodies
Official Correspondence with Ministries, Periodic, Subject-Specific or Sector-Wide
Meetings, Workshops etc. Events, Public Opinion Documents, Information Reports,
Presentations and Position Documents, Periodic Publications and Bulletins, Periodic
Contents (Business Plans, Annual Plans, Strategy Documents, Action Plans etc.)
NGOs
Media
Students
Academicians
Board of Directors Meetings, Working Group Meetings, Council Meetings, Workshops,
Seminars and Conferences, Annual Forums and Meetings, Regional Events, Fairs, Award
Ceremonies, Subject-Oriented Initiatives (via website and social media), Memberships,
Working Groups Activities and Projects, Meetings, Joint Projects
Direct Communication, Turkcell Media website, Turkcell and Turkcell CEO social media
accounts, turkcell.com.tr,
Curriculum Courses, Certificate Programs, Technical Trip, Project Competitions,
Information Sharing Sessions, Sponsorships in parallel with Turkcell Academy’s Vision of
Raising Qualified Human Resources for the Sector
Curriculum Courses and Certificate Programs in parallel with Turkcell Academy’s Vision
of Raising Qualified Human Resources for the Sector, Scholarship Opportunity for PhD
Students studying in the Field of Artificial Intelligence with the Turkcell Foundation,
Supporting Publications
Think tanks
Content and Contribution to Publications Prepared for the Sector
3GPP
AUSDER
BCTR
BGD
EDİDER
DEİK
ECTA
ETİD
ETSI
FIRST
FKB
GSMA
GTI
IAPP
IIC
ItechLaw
ITU
MOBİSAD
M-TOD
MÜSİAD
NGMN
ÖDED
PERYÖN
SKD
TELKODER
TOBB
TUYAD
TÜBİSAD
TÜSİAD
TÜYİD
The 3rd Generation Partnership Project
Intelligent Transportation System Association of Turkey
Blockchain Turkey Platform
Information Security Association (ISA)
Digitalization in Energy Association
Foreign Economic Relations Board of Turkey
European Competitive Telecommunications Association
Electronic Commerce Operators Association
European Telecommunications Standards Institute
Forum of Incident Response and Security Teams
Financial Institutions Union
Global System for Mobile Communications Association
Global TD-LTE Intiative
International Association of Privacy Professionals
International Institute of Communication
International Technology Law Association
International Telecommunication Union
Mobile Communication Tools and Information Technologies Businessmen Association
Mobile Telecommunication Operators Association
Independent Industrialists and Businessmen Association
Next Generation Mobile Networks
Payment and Electronic Money Association
Turkey People Management Association
Business World and Sustainable Development Association
Turkish Competitive Telco Operators’ Association
The Union of Chambers and Commodity Exchanges of Turkey
Telecommunications Satellite and Broadcasting Business People Association
Informatics Industry Association
Turkish Industry and Business Association
Turkish Investor Relations Society
UN (UN Global Compact)
United Nations Global Compact
WTECH
YASED
Women’s Association in Technology
International Investors Association
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AppendicesTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
MURAT ERKAN, SERHAT DEMİR, GEDİZ SEZGİN
Media Excellence Awards
Social Cause - Related Campaign Award for our Smile and Make Them Smile project
226
APPENDIX-3: Board of Directors memberships
Non-governmental organization
Board Member
BURHANETTİN AL
BGD
M-TOD
TÜYİD
TUYAD
FKB
DEİK
ZEYNEL KORHAN BİLEK
BARIŞ ZAVAROĞLU
ZEYNEL KORHAN BİLEK
AFİF DEMİRKIRAN (Associate Member)
Award
Content
Corporate Content Awards
Europe
With our Smile and Make Them Smile project, two gold awards in the Best Use of
Mobile and Best Content Targeted to the CSR Community categories
MarTech Awards
First prize in the category of Best Use of Technology in Public Relations with our Smile
and Make Them Smile project
Social Media Awards
Three bronze and one silver awards at the Social Media Awards Turkey - Jury Awards
with our ‘’Let Those Without Barriers Make Their Dreams Realize’’, and “Smile and Make
them Smile” projects
Stevie Mena 2020
Gold Stevie award in “General Information Web Sites Innovation Award” category at
Stevie Mena 2020 with our Turksporu.com.tr project
The Ones who Take
Agriculture to the Future
At the Future of the Agriculture Forest Summit held under the auspices of the Ministry
of Agriculture and Forestry, Turkcell won the “Carrying Agriculture to the Future” award
with its Filiz Project.
Effie Awards Turkey
Gold Effie in Telecommunication Brands and Services category with Turkcell Fiber
Speed Everywhere campaign with Superbox. Bronze Effie in the Tourism - Culture - Art
category with fizy Inter-High School Music Competition.
HRO Today Association
Awards
“Recruitment Team of the Year” award within the scope of Europe, Middle East and
Africa regions
With The “Bu mu Bu mu?” Campaign; Felis award in the “In-Store Customer Experience”
category Achievement awards in “Use of Contact Point Technologies”, “In-store
Media Usage” and “Digital Installation” categories. With The “Şanslı Çark” Campaign;
achievement award in the “Digital Installation” category
Award in the social responsibility category with our free shopping project during the
pandemic period for people over 65, which we implemented in cooperation with the
Getir brand.
Turkey’s Best Mobile Network Solution Provider award with the SuperBox product
PSM Awards
International Business
Magazine Awards
Asia Communication Awards
Network Transformation Initiative award with our “FMC - Fixed & Mobile Convergence”
and “World’s first live network 800G Capacity Carrier” projects carried out in the
Transport Network
HR Brilliance Awards
Silver award in the “HR Team of the Year” category for the “Emotion - Situation Analysis
with Artificial Intelligence” project we implemented in the GNÇYTNK 2020 process.
IDC Türkiye
At the IDC Cloud&Datacenter Summit 2020; Turkcell artificial intelligence platform and
Turkcell public cloud project awards in the private cloud category at the Cloud awards
given as part of the summit.
5th Most Admired Company at
Capital & Zenna
In the “Most Admired Companies” survey published in Capital magazine, the 5th
Company, ranked 2nd in the “Employee Satisfaction” category, and the 3rd Company in
the “Social Benefits Provided to Employees” category.
Awards for SDG
Platinum award in the Responsible Production and Consumption Category at the
Sustainable Development Goals Awards of the CSR Summit with our Convert to
Education Project
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Turkey’s Best Place to Work
“2019 Best Workplaces Program at” Kincentric Turkey - Best Employer award
organized by Kincentric
MediaCat - Felis Awards
APPENDIX-4: Turkcell 2020 awards
In addition to the awards in the relevant sections of the report, we were deemed worthy of the awards given below and
much more in 2020.
Award
Content
GSMA Glomo Awards
“Most Innovative Application” award with BiP’s translation feature at GLOMO,
organized by World Mobile Operators Association GSMA
Trust Awards 2020
Most Reliable Telecommunications Company
Şikayet var ACE Awards
First prize with Turkcell Diamond in the category of “Communication”
Second prize in the “Service Provider” category and Turkcell TV+ third prize in the
“Digital Platform” category.
Ace of M.I.C.E
Best Activity Award for the Ambassadors Summit 2018 held for Turkcell dealership
employees.
Best Children’s Event with Children’s Festival 2019 and Best Guerrilla Event with UEFA
Super Cup Final Event 2019.
Eventex Awards
Turkcell 23rd of April Children’s Festival (2019), 1 gold and VoD (Voice of Directors)
internal communication events, 1 silver, 4 bronze awards, total 6 awards.
Loyalty Magazine Awards
Award of the Best Corporate Social Responsibility Initiative with Intelligence Power
Whiz Kids’ Mark at
TEKNOFEST
World HR Congress
Four awards for Turkcell Whiz Kids students
“Best Orientation Program for New Employees” award with Turkcell Academy
GNÇYTNK training program
Brandon Hall Excellence
Awards
Separate awards for two trainings focused on financial development and leadership
of Turkcell Akademi
50 HR Leaders who Discover
the Future
One of the 50 HR Leaders Who Discover the Future - Serhat Demir, our Assistant
General Manager Responsible for Turkcell Law, Regulation and Human Resources
AppendicesTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
228
APPENDIX-5: GRI content index table
You can find the GRI items and related sections answered by the report within the scope of GRI 102-55 on this table.
GRI items on material issues are marked with
GRI 102 General Disclosures (2016)
Disclosure
Organizational Profile
Report section
Page
GRI 102 General Disclosures (2016)
Disclosure
Governance
Report section
Page
102-1 Name of the Organization
About the report
102-2 Activities, Brands, Products, and Services
About Turkcell
102-3 Location of Headquarters
Turkcell Küçükyalı Plaza, Aydınevler Mahellesi İnönü
Caddesi No:20 Küçükyalı Ofispark B Blok – Maltepe /
İSTANBUL
102-4 Location of Operations
Turkcell Group: Developments in 2020
102-5 Ownership and Legal Form
About Turkcell
102-6 Markets Served
102-7 Scale of the Organization
102-8 Information on Employees and Other
Workers
About Turkcell
Turkcell Group: Developments in 2020
About Turkcell
Revenues from operations
Diversity, inclusion and equal opportunity
Diversity, inclusion and equal opportunity
102-9 Supply Chain
Value oriented, responsible supply chain management
102-10 Significant Changes to the
Organization and its Supply Chain
Shareholder structure
The marketing cooperation between Turkcell Europe
GmbH, our company’s subsidiary in Germany, and
Telekom Deutschland Multibrand GmbH, a subsidiary of
Deutsche Telekom, was terminated on April 30, 2020 in
accordance with the relevant contract.
In the reporting year, there was no significant change
regarding the organization’s supply chain
102-11 Precautionary Principle or Approach
Risk management and internal control mechanism
102-12 External Initiatives
Measuring the value created
102-13 Membership of Associations
Cooperated national, international and non-
governmental organizations
Board of Directors memberships
Strategy
102-14 Statement from Senior Decision-maker
Message from the CEO
102-15 Key Impacts, Risks and Opportunities
Risk management and internal control mechanism
Ethics and Integrity
102-16 Values, Principles, Standards, and Norms of
Behavior
Our vision and mission
102-17 Mechanism for Advice and Concerns About
Ethics
Human rights, work ethics and common values
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102-18 Governance Structure
Management Team support for value-creation process
102-19 Delegation
Management Team support for value-creation process
102-20 Responsibility at the Management Level of
Environmental, Economic and Social Issues
102-21 Stakeholder Consultation on Economic,
Environmental and Social Issues
102-22 Composition of the Highest Governance
Body and its Commitments
Management Team support for value-creation process
Management Team support for value-creation process
Management Team support for value-creation process
102-23 Chair of the Highest Governance Body
Management Team support for value-creation process
102-24 Nomination and Selection of the
Governance Body
102-26 The Role of the Highest Governance Body
in Determining Purpose, Value and Strategy
102-29 Identifying and Managing Economic,
Environmental and Social Impacts
102-31 Review of Economic, Environmental, and
Social Topics
102-32 Highest Governance Body’s Role in
Sustainability Reporting
Management Team support for value-creation process
Management Team support for value-creation process
Management Team support for value-creation process
Risk management and internal control mechanism
Management Team support for value-creation process
102-33 Communicating Critical Concerns
Risk management and internal control mechanism
102-35 Remuneration Policies
Diversity, inclusion and equal opportunity
Sustainability strategy
102-36 Process for Determining Remuneration
Transparent performance evaluation
Stakeholder Engagement
102-40 List of Stakeholder Groups
Communication channels table
102-41 Collective Working Agreements
There are no collective bargaining practices for
employees under Turkcell payroll.
102-42 Identifying and Selecting Stakeholders
Interactions with our stakeholders
102-43 Approach to Stakeholder Engagement
Interactions with our stakeholders
Communication Channels Table
102-44 Key Issues and Concerns
Material topics
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GRI 102 General Disclosures (2016)
Disclosure
Reporting Practice
Report section
Page
102-45 List of all Entities Included in the
Organization’s Consolidated Financial Statements
or Equivalent Documents
Consolidated Financial Statements
102-46 Defining Report Content and Topic
Boundaries
About the report
102-47 List of Material Topics
Material topics
102-48 Restatement of Information
Consolidated Financial Statements
102-49 Changes in Reporting
102-50 Reporting Period
102-51 Date of Most Recent Report
Material topics
About the report
In March 2019, Turkcell Annual Report covering our
activities in 2019 and Turkcell Sustainability Report in July
2020 have been published.
102-52 Reporting Cycle
102-53 Contact Point for Questions Regarding the
Report
About the report
About the report
102-54 Claims of Reporting in Accordance with
the GRI Standards
About the report
102-55 GRI Content Index
GRI content index table
102-56 External Assurance
External assurance has been obtained only for the
items specified in the Turkcell 2020 Integrated Report.
GRI 201 Economic Performance (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its
Boundary
Strong financial performance
103-2 The Management Approach and its
Components
Strong financial performance
103-3 Evaluation of the Management Approach
Capital market instruments performance,
Sustainability indices and performance indicators,
Share information and dividend yield
201-1 Direct Economic Value Generated and
Distributed
Financial capital
201-2 Financial Implications and other Risks and
Opportunities due to Climate Change
Climate crisis management
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GRI 202 Market Presence (2016)
Disclosure
Report section
202-1 Ratio of Standard Entry Level Wages by
Gender and Local Minimum Wage
Diversity, inclusion and equal opportunity
GRI 203 Indirect Economic Impacts (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its
Boundary
Base stations and public health
103-2 The Management Approach and its
Components
Innovation and entrepreneurship
Base stations and public health
103-3 Evaluation of the Management Approach
Base stations and public health
203-1 Infrastructure Investments and Services
Supported
Strong infrastructure
203-2 Important Indirect Economic Impacts
Innovation and entrepreneurship
Base stations and public health
GRI 204 Procurement Practices (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its
Boundary
103-2 The Management Approach and its
Components
Value oriented, responsible supply chain management
Value oriented, responsible supply chain management
103-3 Evaluation of the Management Approach
Value oriented, responsible supply chain management
204-1 Ratio of Spendings on Local Suppliers
Value oriented, responsible supply chain management
GRI 205 Anti-corruption (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its
Boundary
Compliance with international capital markets and
effective corporate governance practices
103-2 The Management Approach and its
Components
Compliance with international capital markets and
effective corporate governance practices
103-3 Evaluation of the Management Approach
Compliance with international capital markets and
effective corporate governance practices
205-1 Activities Assessed in Terms of Corruption-
Related Risks
Compliance with international capital markets and
effective corporate governance practices
205-2 Communication and Training on Anti-
Corruption Policies and Procedures
Compliance with international capital markets and
effective corporate governance practices
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GRI 206 Anti-competitive Behavior (2016)
Disclosure
103-1 Explanation of the Material topic and its
Boundary
Report section
Competition management
103-2 The Management Approach and its
Components
Competition management
103-3 Evaluation of the Management Approach
Competition management
206-1 Legal Actions for Anti-competitive Behavior,
Anti-trust, and Monopoly Practices
Competition management
GRI 302 Energy (2016)
Disclosure
103-1 Explanation of the Material topic
and its Boundary
103-2 The Management Approach
and its Components
Report section
Energy management
Energy management
103-3 Evaluation of the Management Approach
Energy management
302-1 Energy Consumption within the Organization
302-3 Energy Intensity
Emissions management
Renewable energy
Renewable energy
302-4 Reduction of Energy Consumption
Renewable energy
GRI 305 Emissions (2016)
Disclosure
103-1 Explanation of the Material topic and its
Boundary
Report section
Emissions management
103-2 The Management Approach and its
Components
Emissions management
103-3 Evaluation of the Management Approach
Emissions management
305-1 Scope 1 Emissions: Direct GHG Emissions
Emissions management
305-2 Scope 2 Emissions: Energy Indirect GHG
Emissions
Emissions management
305-3 Scope 3 Emissions: Other Indirect GHG
Emissions
Emissions management
305-4 Emission Intensity
Emissions management
305-5 Reduction GHG Emissions
Emissions management
305-6 Emissions of Substances That Deplete
the Ozone Layer
Emissions management
305-7 NOx, SOx and Other Significant Air
Emissions
Not applicable to Turkcell’s operational boundaries.
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GRI 306 Waste management (2016)
Disclosure
103-1 Explanation of the Material topic and its
Boundary
103-2 The Management Approach and its
Components
Report section
Waste management
Waste management
103-3 Evaluation of the Management Approach
Waste management
306-2 Type and Wastes by Disposal Method
Waste management
306-3 Significant Leaks
306-5 Water Affected by Water Discharge and
Water Discharges
Leaks and spills of liquid wastes are not within the
scope of Turkcell’s operation.
Municipal water is used at offices within the scope
of Turkcell operations. Water affected by Turkcell’s
drainage and water discharge is in the scope of water
intended for human consumption.
GRI 307 Environmental compliance (2016)
Disclosure
Report section
307-1 Non-compliance with Environmental Laws
and Regulations
Fight against climate change
and effective energy management
GRI 308 Supplier environmental assessment (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its
Boundary
103-2 The Management Approach and its
Components
Value oriented, responsible supply chain management
Value oriented, responsible supply chain management
103-3 Evaluation of the Management Approach
Value oriented, responsible supply chain management
308-1 New Suppliers that were Screened Using
Environmental Criteria
308-2 Negative Environmental Impacts in the
Supply Chain and Actions Taken
Value oriented, responsible supply chain management
Value oriented, responsible supply chain management
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GRI 401 Employment (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Making a difference in employment
103-2 The Management Approach and its Components
Making a difference in employment
103-3 Evaluation of the Management Approach
Making a difference in employment
401-1 Recruitment and Employee Exchange
Making a difference in employment
Diversity, inclusion and equal opportunity
401-2 Benefits Provided to Full Time Employees, but Not
Provided to Temporary or Part-Time Employees
Employee loyalty and happiness
401-3 Maternity Leave
Diversity, inclusion and equal opportunity
GRI 402 Labor/Management Relations (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Employee loyalty and happiness
103-2 The Management Approach and its Components
Employee loyalty and happiness
103-3 Evaluation of the Management Approach
Employee loyalty and happiness
402-1 Minimum Notice Periods Regarding Operational
Changes
Human capital management
GRI 403 Occupational Health and Safety (2018)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Safe and healthy work environment
103-2 The Management Approach and its Components
Safe and healthy work environment
103-3 Evaluation of the Management Approach
Safe and healthy work environment
403-1 Occupational Health and Safety Management System Safe and healthy work environment
Base stations
403-2 Hazard Identification, Risk Assessment, and Incident
Investigation
Safe and healthy work environment
Base stations
403-3 Occupational Health Services
403-4 Worker Participation, Consultation, and
Communication on Occupational Health and Safety
Safe and healthy work environment
No employees are excluded from the OHS
Management System.
Safe and healthy work environment
403-5 Worker Training on Occupational Health and Safety
Safe and healthy work environment
403-6 Promotion of Worker Health
Employee loyalty and happiness
403-7 Prevention and Mitigation of Occupational Health and
Safety Impacts Directly Linked by Business Relationships
Safe and healthy work environment
Base stations
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GRI 403 Occupational Health and Safety (2018) continued
Disclosure
Report section
403-8 Workers Covered by an Occupational Health and
Safety Management System
Safe and healthy work environment
Base stations
403-9 Work-related Injuries
Safe and healthy work environment
403-10 Work-related Ill Health
Safe and healthy work environment
GRI 404 Training and Education (2016)
Disclosure
103-1 103-1 Explanation of the Material topic and its
Boundary
Report section
Turkcell Academy
103-2 The Management Approach and its Components
Turkcell Academy
103-3 Evaluation of the Management Approach
Turkcell Academy
404-1 Average Hours of Training Per Year Per Employee
Turkcell Academy
404-2 Programs for Upgrading Employee Skills and
Transition Assistance Programs
Turkcell Academy
404-3 Percentage of Employees Receiving Regular
Performance and Career Development Reviews
Transparent performance evaluation
GRI 405 Diversity and Equal Opportunity (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Diversity, inclusion and equal opportunity
103-2 The Management Approach and its Components
Diversity, inclusion and equal opportunity
103-3 Evaluation of the Management Approach
Diversity, inclusion and equal opportunity
405-1 Diversity of Governance Bodies and Employees
Diversity, inclusion and equal opportunity
405-2 Ratio of Basic Salary and Remuneration of Women
to Men
Diversity, inclusion and equal opportunity
GRI 406 Non-discrimination (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Diversity, inclusion and equal opportunity
103-2 The Management Approach and its Components
Diversity, inclusion and equal opportunity
103-3 Evaluation of the Management Approach
Diversity, inclusion and equal opportunity
406-1 Incidents of Discrimination and Corrective Actions
Taken
Diversity, inclusion and equal opportunity
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AppendicesTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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GRI 407 Freedom of Association and Collective Bargaining (2016)
Disclosure
Report section
407-1 Operations and Suppliers in Which the Right to
Freedom of Association and Collective Bargaining may
be at Risk
Human rights, work ethics and common values
Value oriented responsible supply chain management
GRI 408 Child Labor (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Value oriented responsible supply chain management
103-2 The Management Approach and its Components
Value oriented responsible supply chain management
103-3 Evaluation of the Management Approach
Value oriented responsible supply chain management
408-1 Operations and Suppliers at Significant Risk for
Incidents of Child Labor
Diversity, inclusion and equal opportunity
Value oriented responsible supply chain management
GRI 409 Forced or Compulsory Labor (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Value oriented responsible supply chain management
103-2 The Management Approach and its Components
Value oriented responsible supply chain management
103-3 Evaluation of the Management Approach
Value oriented responsible supply chain management
409-1 Operations and Suppliers at Significant Risk for
Incidents of Child Labor
Diversity, inclusion and equal opportunity
GRI 410 Security Practices (2016)
Disclosure
Report section
410-1 Security Personnel Trained in Human Rights Policies
or Procedures
Safe and healthy work environment
GRI 413 Yerel Toplumlar (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Creating social value
103-2 The Management Approach and its Components
Creating social value
103-3 Evaluation of the Management Approach
Creating social value
413-1 Operations with Local Community Engagement,
Impact Assessments, and Development Programs
Base stations and public health
Creating social value
413-2 Operations with Significant Actual and Potential
Negative Impacts on Local Communities
Base stations and public health
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GRI 414 Supplier Social Assessment (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its
Boundary
103-2 The Management Approach and its
Components
Value oriented responsible supply chain management
Value oriented responsible supply chain management
103-3 Evaluation of the Management Approach
Value oriented responsible supply chain management
414-1 New Suppliers that were Screened Using
Social Criteria
414-2 Negative Social Impacts in the Supply Chain
and Actions Taken
Value oriented responsible supply chain management
Value oriented responsible supply chain management
GRI 415 Public Policy (2016)
Disclosure
Report section
415-1 Political Contributions
Social investment projects
GRI 416 Customer Health and Safety (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Our public affairs
103-2 The Management Approach and its Components
Our public affairs
103-3 Evaluation of the Management Approach
Our public affairs
416-1 Assessment of the Health and Safety Impacts of
Product and Service Categories
Base stations and public health
416-2 Incidents of Non-compliance Concerning the Health
and Safety Impacts of Products and Services
Base stations and public health
GRI 418 Customer Privacy (2016)
Disclosure
Report section
103-1 Explanation of the Material topic and its Boundary
Cyber security
103-2 The Management Approach and its Components
Cyber security
Digital business services (DBS)
103-3 Evaluation of the Management Approach
Cyber security
GRI 419 Socioeconomic Compliance (2016)
Disclosure
Report section
419-1 Non-compliance with Laws and Regulations in the
Social and Economic Area
Our Companies and sector developments
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AppendicesTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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APPENDIX-6: UNGC progress table
Topic
UNGC Principles
Human Rights
Labor
Principle 1: Businesses should support and respect the
protection of internationally proclaimed human rights
Principle 2: make sure that they are not complicit in human
rights abuses
Principle 3: Businesses should uphold the freedom of
association and the effective recognition of the right to
collective bargaining
Principle 4: the elimination of all forms of forced and
compulsory labor
Principle 5: the effective abolition of child labor
Principle 6: the elimination of discrimination in respect of
employment and occupation
Principle 7: Businesses should support a precautionary
approach to environmental challenges
Environment
Principle 8: undertake initiatives to promote greater
environmental responsibility
Principle 9: encourage the development and diffusion of
environmentally friendly technologies
2020 Turkcell
Integrated Report Section
Strong corporate governance
Human capital
Strong corporate governance
Human capital
Human capital
Human capital
Social values and relations
Human capital
Social values and relations
Human capital
Natural capital
Natural capital
Natural capital
Anti-corruption
Principle 10: Businesses should work against corruption in all its
forms, including extortion and bribery
Strong corporate governance
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Appendices
APPENDIX-7: Sustainability Principles Compliance Framework table
Please find the reference to relevant report sections at which we addressed the Comply or Explain requirement of the
principles.
IR Section
Page
A.GENERAL PRINCIPLES
A1. Strategy, Policy and Goals
The Board of Directors determines ESG material issues,
risks and opportunities, and creates ESG policies
accordingly. In terms of the effective implementation
of these policies; In-partnership directives, business
procedures, etc. can be prepared. The Board of Directors
takes decisions on these policies and discloses them to
the public.
It determines the Partnership Strategy appropriate to the
ESG policies, risks and opportunities. It determines and
publicly discloses its short and long-term goals in line
with the partnership strategy and ESG policies.
A2. Implementation/Monitoring
It determines the committees/units responsible for the
execution of ESG policies and makes them public. The
responsible committee/unit reports the activities carried
out within the scope of the policies to the Board of
Directors at least once a year, and in any case within the
maximum periods determined for the public disclosure of
annual activity reports in the relevant Board regulations.
Management Team support for
value-creation process
Management Team support for
value-creation process
Management Team support for
value-creation process
Creates and publicly discloses implementation and
action plans in line with the short- and long-term goals
set.
Management Team support for
value-creation process
Determines the ESG Key Performance Indicators (KPI)
and explains them on a yearly basis. In the presence
of verifiable data, it presents KPIs with local and
international sector comparisons.
Sustainability strategy
Explaining the innovation activities that may improve
the sustainability performance of business processes or
products and services.
Intellectual capital
Social investment projects
A3. Reporting
Reports the sustainability performance, goals and
actions at least once a year and makes it public.
Discloses the information on sustainability activities
within the scope of the annual report
It is essential to share information that is important for
stakeholders in understanding the position, performance
and development of the partnership in a direct and
concise manner. It can also explain detailed information
and data on the corporate website and prepare
separate reports that directly meet the needs of
different stakeholders.
About the report
About Turkcell
Strong corporate governance
Additionally, as listed in communication
channels in Annex – 1 of the report,
important statements are shared with
the public through channels including
Quarterly Result Disclosures and
Material Disclosures (ÖDA) via the
Public Disclosure Platform.
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IR Section
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2
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4
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7
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9
It takes maximum care in terms of transparency and
reliability. It objectively explains all kinds of developments
concerning material issues in disclosures and reporting
within the scope of the balanced approach.
About the report
Sustainability strategy
Delivers information on which of the United Nations (UN)
2030 Sustainable Development Goals its activities are
related to.
Sustainable Development Goals
Interaction of material topics
An explanation about the lawsuits filed and / or
concluded against environmental, social and corporate
governance issues.
Strong corporate governance
A4. Verification
Verification is done by independent third parties
(independent sustainability assurance providers), and it
discloses its sustainability performance measurements
to the public and endeavors to increase the coverage of
such verification processes.
B. ENVIRONMENTAL PRINCIPLES
Explains policies and practices, action plans,
environmental management systems (known by the
ISO 14001 standard) and programs in the field of
environmental management.
Emissions management
Management Team support for
value-creation process
Natural capital
Complies with environmental laws and other relevant
regulations and explains them.
Fight against climate change and
effective energy management
It explains the limitations of the environmental report to
be included in the report prepared within the scope of
the Sustainability Principles, reporting period, reporting
date, data collection process and reporting conditions.
About the report
GRI content index
Describes the highest level responsible, relevant
committees and tasks within the partnership on the issue
of the environment and climate change.
Management Team support for
value-creation process
Describes the incentives it offers for the management of
environmental issues, including the achievement of goals.
Fight against climate change and
effective energy management
Explains how environmental problems are integrated into
business goals and strategies
Sustainability strategy
Energy management
Renewable energy
Explains the sustainability performance of business
processes or products and services, and the activities
undertaken to improve this performance.
Environmentally friendly and practical
solutions through digitalization
Natural capital
It explains how it manages environmental issues along
the partnership value chain and integrates suppliers and
customers into its strategies, not just in terms of direct
operations.
Sustainability strategy
Fight against climate change and
effective energy management
Explanation of involvement in policy-making processes
on environmental issues (sectoral, regional, national and
international); cooperation with the associations, related
organizations and non-governmental organizations
concerning the environment, and the duties it has taken,
if any, and the activities it supports.
Measuring the value created
UNGC CFO Task Force
Contribution to exchanging knowledge
and experience across all stakeholders
Appendix-2
Appendix-3
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226
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TURKCELL INTEGRATED ANNUAL REPORT 2020
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Appendices
IR Section
Page
IR Section
Page
Reports periodically comparable information on
environmental impacts in the light of environmental
indicators (Greenhouse gas emissions (Scope-1 (Direct),
Scope-2 (Energy indirect), Scope-3 (Other indirect) 1), air
quality, energy management, water and wastewater
management, waste management, biodiversity impacts)
Fight against climate change and
effective energy management
It describes the standard, protocol, methodology, and
base year details used to collect and calculate its data.
Emissions management
(ISO 14064 GHG Emissions Calculation
and Verification System)
Describing the status of environmental indicators for the
reporting year (increase or decrease) in comparison with
previous years.
Natural capital
Sets short and long-term goals to reduce its
environmental impact and explains these goals. It
is recommended that these targets be determined
based on Science as suggested by the United Nations
Conference of the Parties on Climate Change. If there is
progress in the reporting year according to the targets
set before, it provides information on the subject.
Renewable energy
Explains the strategy adopted and actions taken to
combat the climate crisis.
Sustainability strategy
Fight against climate change and
effective energy management
Describes the program or procedures to prevent or
minimize the potentially negative impact of the products
and/or services it offers; explains the actions of third
parties to reduce greenhouse gas emissions.
High speed, high quality and inclusive
services; Access to information and
internet for everyone
Renewable energy
It explains the actions taken to reduce its environmental
impacts, the total number of projects and initiatives
carried out, and the environmental benefits / benefits
and cost savings they provide.
Natural capital
It reports the total energy consumption data (excluding
raw materials) and describes the energy consumption as
Scope-1 and Scope-2.
Emissions management
Provides information on electricity, heat, steam and
cooling generated and consumed in the reporting year.
Renewable energy
Emissions management
Carries out studies on increasing the use of renewable
energy, transition to zero or low carbon electricity and
explains these studies.
Renewable energy
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19
20
Explains renewable energy production and usage data.
Renewable energy
21
Explains energy efficiency projects and the amount of
energy consumption and emission reduction resulting
from them.
Renewable energy
You can access our 2020 CDP Report
at https://s.turkcell.com.tr/SiteAssets/
Hakkimizda/en/corporate-social/
programme-response-investor-
CDP-2020.pdf
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25
It reports the amount of water withdrawn, used,
recycled and discharged from underground or above
ground, its sources and procedures (Total water
withdrawal by source, water resources affected by
water withdrawal; percentage and total volume of
recycled and reused water, etc.).
Water management
It explains whether operations or activities are included
in any carbon pricing system (Emission Trading System,
Cap & Trade, or Carbon Tax).
Climate crisis management
You can access our 2020 CDP Report
at https://s.turkcell.com.tr/SiteAssets/
Hakkimizda/en/corporate-social/
programme-response-investor-
CDP-2020.pdf
Describes the carbon credit information accumulated or
purchased during the reporting period.
Fight against climate change and
effective energy management
Explains the details where carbon pricing is applied
within the partnership.
26
Explains all mandatory and voluntary platforms on which
it discloses environmental information.
Climate crisis management
You can access our 2020 CDP Report
at https://s.turkcell.com.tr/SiteAssets/
Hakkimizda/en/corporate-social/
programme-response-investor-
CDP-2020.pdf
You can access our 2020 CDP Report
at https://s.turkcell.com.tr/SiteAssets/
Hakkimizda/en/corporate-social/
programme-response-investor-
CDP-2020.pdf
C. SOCIAL PRINCIPLES
C1. Human Rights and Employee Rights
Develops a Corporate Human Rights and Employee
Rights Policy declaring full compliance with the Universal
Declaration of Human Rights, the ILO Conventions which
Turkey has approved, and the legal framework and
regulations governing human rights and working life in
Turkey. Discloses the policy in question and the roles and
responsibilities for its implementation.
Provides equal opportunity in recruitment processes.
Considering supply and value chain effects, it includes
fair workforce, improvement of labor standards, women’s
employment and inclusion issues (such as women,
men, religious belief, language, race, ethnic origin, age,
disability, refugee, etc.) in its policies.
Describes measures taken along the value chain for the
protection of certain economic, environmental, social
factors (low-income groups, women, etc.) or minority
rights / equality of opportunity.
Diversity, inclusion and equal
opportunity
Value oriented, responsible supply
chain management
Making a difference in employment
Employee relations
Diversity, inclusion and equal
opportunity
Making a difference in employment
Social investment projects
Reporting developments regarding discrimination,
inequality, human rights violations, forced labor, and
corrective practices. Explaining the regulations preventing
the employment of child labor.
Diversity, inclusion and equal
opportunity
Value oriented, responsible supply
chain management
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TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
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Explains policies regarding investment in employees
(training, development policies), compensation, vested
benefits, right to unionize, work/life balance solutions
and talent management. Determines dispute resolution
processes by creating mechanisms for employee
complaints and dispute resolution. It regularly explains
the activities carried out to ensure employee satisfaction.
Creates occupational health and safety policies
and makes them public. Provides explanation of the
precautions taken and accident statistics gathered to
prevent work accidents and health.
IR Section
Human capital
Our corporate social values and
relations
Page
128
184
Safe and healthy work environment
137
Public disclosure on personal data protection and data
security policies.
https://www.turkcell.com.tr/tr/gizlilik-
ve-guvenlik?page=kisisel-verilerin-
korunmasi
Ethical policy explanation including work, work ethics,
compliance processes, advertising and marketing ethics,
open disclosure, etc.
Human rights, work ethics and
common values
Explains work done within the scope of social
investment, social responsibility, financial inclusion and
access to finance.
10
Organizes informational meetings and training programs
for employees on ESG policies and practices.
C2. Stakeholders, International Standards and Initiatives
Carries out its activities in the field of sustainability by
considering the needs and priorities of all stakeholders
(employees, customers, suppliers and service providers,
public institutions, shareholders, society and non-
governmental organizations, etc.).
It regulates and publicly discloses a customer
satisfaction policy regarding the management and
resolution of customer complaints.
Conducts stakeholder communication continuously
and transparently; It explains which stakeholders are
contacted, for what purpose, on what issue and the
frequency of communication, and also on developments
in sustainability activities.
Publicly discloses the international reporting standards
it has adopted (Carbon Disclosure Project (CDP), Global
Reporting Initiative (GRI), International Integrated
Reporting Council (IIRC), Sustainability Accounting
Standards Board (SASB), Climate-Related Financial
Disclosures Task Force (TCFD), etc.)
1
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Digital transformation and inclusion
Diversified financing
Techfin’s shining stars: Paycell and
Financell
High speed, high quality and inclusive
services; Access to information and
internet for everyone
Social investment projects
Sustainability strategy
Compliance with international capital
markets and effective corporate
governance practices
Safe and healthy work environment
Material topics
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194
Interactions with our stakeholders
About the report
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IR Section
Measuring the value created
Being the leader and pioneer company
in our sector and country through
representations
Page
76
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Sustainability indices and performance
indicators
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Statement of compliance with
corporate governance principles for
the year 2020
Sustainability strategy
Statement of compliance with
corporate governance principles for
the year 2020
Material topics
Sustainability strategy
Social investment projects
Being the leader and pioneer company
in our sector and country through
representations
Publicly discloses the international organizations or
principles (Equator Principles, United Nations Environment
Program Finance Initiative (UNEP-FI), United Nations
Global Principles (UNGC), United Nations Principles
for Responsible Investment (UNPRI), etc.) that it is a
signatory or member, international principles adopted
(International Capital Market Association (ICMA) Green/
Sustainable Bond Principles).
Concrete efforts to be included in the Borsa Istanbul
Sustainability Index and international sustainability
indices (Dow Jones Sustainability Index, FTSE4Good,
MSCI ESG Indices, etc.).
D. CORPORATE GOVERNANCE PRINCIPLES
Within the scope of Capital Markets Board Corporate
Governance Communique numbered II-17.1, it makes
maximum effort to comply with all Corporate
Governance principles in addition to the mandatory
Corporate Governance principles.
While determining its corporate governance strategy,
it considers the sustainability issues, the environmental
impacts of its activities and the principles in this regard.
As stated in the Corporate Governance Principles, it
takes the necessary measures to comply with the
principles regarding stakeholders and to strengthen
the communication with the stakeholders. It seeks the
opinions of stakeholders while determining its measures
and strategies regarding sustainability issues.
It implements social responsibility projects, awareness
activities and trainings to raise awareness regarding
sustainability issues and their importance.
It endeavors to be a party to the international standards
and initiatives on sustainability and to contribute to their
related projects.
Measuring the value created
Being the leader and pioneer company
in our sector and country through
representations
Discloses its policies and programs regarding anti-
bribery and anti-corruption and tax integrity principle.
Anti-bribery and corruption policy
Financial capital
Our public affairs
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AppendicesTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
246
Group companies and other information
on corporate governance
Group companies
and other information
on corporate governance
248
Our subsidiaries
254
Subsequent events after the reporting period
256
2020 financial year Corporate Governance Principles Compliance Report
270
Other issues regarding corporate governance
272
Conclusion of the subsidiary report
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
247
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248
Our subsidiaries*
its subscribers to choose their eSIM
numbers.
lifecell has actively participated in
activities to combat COVID-19, do-
nating 2 mechanical ventilators to
the Ukraine COVID-19 control center.
Furthermore, lifecell provided free of
charge communication packages in-
cluding 20 GB and 1500 voice minutes
to over 13,000 health sector workers in
March and April. Additionally, the op-
erator sent over 8 million information
messages to its subscribers on behalf
of the Ministry of Health. Moreover, li-
fecell zero rated the traffic and voice
calls to the numbers and web pages
of the Ministry of Health and Ministry
of Foreign Affairs.
lifecell became the first operator to
test the 5G network segment at its
headquarters in Kiev in March in coop-
eration with Ericsson. Furthermore, the
company acquired a new license, in-
creasing its 900 MHz frequency band
from 3.8 MHz to 5.6 MHz for UAH121
million also in March. The new fre-
quencies are used to provide LTE ser-
vices to rural regions, and national and
international highways. The respective
license will be effective for five years
as of July 1, 2020.
lifecell
lifecell started its operations in Ukraine
in February 2005. In 2020, lifecell’s
3-month active subscriber base ex-
panded by 0.6 million to 8.1 million.
lifecell sustained its leadership of the
Ukrainian market in smartphone pen-
etration, which had reached 81.2% by
year-end.
lifecell was the first operator to launch
4.5G services for its customers in the
2600 MHz frequency band in 2018,
followed by a successful launch in the
1800 MHz frequency band within the
same year. lifecell had a geographi-
cal coverage of 31.8% and population
coverage of 63.2% in Ukraine (3G and
4.5G) by year end.
In 2020, the number of three-month
active subscribers using 3G and 4.5G
reached 5.5 million, while mobile data
usage per user grew by 64%. lifecell
achieved strong operational perfor-
mance in 2020, with revenue and EBIT-
DA growth of 14.2% and 11.9%, respec-
tively. Meanwhile, lifecell registered
positive net income in 2020, which
was a result of this strong operational
performance. lifecell’s revenues in TL
terms rose 34.9% to TRY1,776 million.
In March 2020, lifecell, together with
the other operators, launched its 4G
service in Kiev metro, and provided its
service in 45 underground metro sta-
tions.
During the period between March-
May 2020, when lockdown measures
were taken against the COVID-19
pandemic, lifecell continued its efforts
towards the provision of high-quality
services to its customers. In this peri-
od, lifecell launched new features in
the BiP Messenger and BiP SOS pack-
age, introducing the BiP Emergency
Virtual Number, and the multi-account
management option in the My lifecell
application. lifecell was the first op-
erator to launch eSIM in Ukraine and
enabled the remote purchase of eSIM,
free-of-charge delivery of lifecell SIM
cards and mobile care services for its
customers. lifecell also gave subscrib-
ers the flexibility to purchase service
packages for their friends and rel-
atives. As voice calls became much
more popular for communication in
Ukraine, lifecell provided additional of-
fers and promotions, including unlimit-
ed call offers to any operators.
In 2020 lifecell continued to offer new
services to its customers. The Pay-
cell Mobile Wallet application helps
its subscribers to make payments in
a secure and comfortable way with
minimum commission rates. Likar On-
line enables users to get remote con-
sultancy from doctors. Over the Busuu
education platform, users have the
opportunity to learn new languages.
With the cooperation of Universalna
insurance company and lifecell, sub-
scribers can purchase travel Insur-
ance. lifecell SCREEN users can receive
screen repair insurance for their mo-
bile devices. Meanwhile, lifecell was
the first operator in Ukraine to allow
following
Turkcell Global Bilgi
Turkcell Global Bilgi offers new gener-
ation services in customer experience
closely
the digitalization
trends and leveraging 21 years of ex-
perience in customer services. Turkcell
Global Bilgi aims to enhance customer
satisfaction and consequently its rev-
enues creating customized solutions
for more than 70 companies including
Turkcell itself. The company continues
its activities acting as strategic busi-
ness partners of its customers.
Turkcell Global Bilgi employs nearly
16 thousand people in 25 locations;
19 in Turkey and 6 in Ukraine as at the
end of 2020. The company leads the
sector and creates value with 9,600
women employees, which make up
60% of the total workforce.
Turkcell Global Bilgi is among Turkey’s
top 500 IT companies and provides
traditional call center services and
also consultancy services such as re-
search management, customer expe-
rience design and social media man-
agement. Turkcell Global Bilgi has re-
alized own digital platforms in its R&D
center and also provides robotic pro-
cess automation, cloud-based switch-
board infrastructure, digital assistant
and self-service information technol-
ogies technical services to companies.
cation using facial recognition tech-
nology based on a machine learning
algorithm in 2020.
The service has been successfully de-
veloped by lifetech, which was estab-
lished as a 99.9% subsidiary of BeST
to serve in the fields of telecommu-
nications and infrastructure solutions,
information and communication tech-
nologies, software development and
security systems.
lifetech successfully provides IT based
solutions to Turkcell Group and other
customers and carries out software
development projects both in Belarus
and other countries.
Kuzey Kıbrıs Turkcell
Kuzey Kıbrıs Turkcell was established in
1999 as a 100% owned subsidiary of
Turkcell. Having operated until 2007 as
part of a revenue sharing agreement
with the Turkish Republic of Northern
Cyprus Telecommunication Depart-
ment, the Company signed an 18-year
GSM license contract in the same year.
Kuzey Kıbrıs Turkcell continues its ac-
tivities as the leading operator of the
TRNC with its infrastructure covering
almost the entire population, and an
active subscriber market share of
65.6%* according to Information Tech-
nologies and Communications Author-
ity data for Q3 of 2020.
Entering the fixed broadband market
in TRNC with Lifecell Digital Ltd. in 2018,
Kuzey Kıbrıs Turkcell continues to serve
in this field with the momentum it has
gained in a short time. With Turkcell
Home Internet, a first for the island, the
people of TRNC are offered postpaid
home internet service regardless of
having a mobile line or being a Turk-
cell customer.
In 2020, Kuzey Kıbrıs Turkcell registered
revenue of TRY239.4 million on 7.7%
annual growth.
BeST
BeST (Belarusian Telecommunications
Network), which joined the Turkcell
Group in July 2008, became the first
mobile operator to offer 3G services in
Belarus in November 2009. As of 2020
year-end, BeST continued its rapid
growth with 99.9% population cover-
age and 97.7% geographical coverage.
BeST became one of the first two op-
erators to offer 4G services in August
2016 through LTE infrastructure estab-
lished by beCloud. BeST provides 4G
LTE services across all regions and
major cities of Belarus with 35% 4G
geographical coverage. The share of
4G subscribers reached 63% of the
3-month active subscriber base in
2020. Increasing 4G services pene-
tration has led to an average monthly
data consumption per user to 13 GB.
The 4G network serves 73% of the to-
tal data traffic as of 2020.
While converting subscribers to 4G
users, BeST continues to transform it-
self from a communication services
provider to a digital operator by offer-
ing diversified digital services portfolio
in accordance with Turkcell’s strategy.
While the tariff plans that include data
and terminal packages enable the
growth of ARPU, BeST enriches cus-
tomers’ digital experiences by bringing
together connectivity and content. Ac-
cordingly, BeST has included BiP, fizy,
lifebox, Magazines, TV+, and Games
Platform to its digital services portfolio.
BeST became the first mobile operator
in Belarus to launch a digital SIM card
activation service via a mobile appli-
* Not all our subsidiaries are included in our Subsidiaries section. You can find the list of subsidiaries in our subsidiaries section of the IFRS report under note 40.
*Active subscriber base excluding telemetri susbcriptions.
249
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
250
Group companies and other information
on corporate governance
Global Tower
Global Tower, Turkey’s leading tow-
er company, today operates in four
countries. Global Tower provides tele-
communications infrastructure servic-
es including tower leasing, tower build
& sell, contract management, mainte-
nance services to mobile operators,
radio and TV broadcasters, internet
service providers, energy companies
and public institutions. Global Tower
also provides satellite services and
solutions to its customers in accord-
ance with its end-to-end services ap-
proach. The company currently offers
closed circuit satellite services over 2
thousand points from its own infra-
structure with geographic redundancy.
The company aims to enrich product
and service diversity by following in-
dustry trends.
Global Tower’s 10,913 tower portfolio
distribution as the end of 2020 is as
follows:
• Turkey: 8,789 (owned: 4,341 right of
use: 2,256, contract management:
2,192)
• Ukraine: 1,175 (owned)
• Belarus: 834 (right of use)
• TRNC: 115 (right of use)
Global Tower closely follows the trans-
formation process of the global tele-
communication infrastructure sector,
from tower management to infra-
structure management, and plans to
introduce new emerging services in
the industry with its customers. It is
also observed that mobile operators
in Turkey have a positive attitude to-
wards infrastructure sharing and con-
solidation model which is pioneered
by Global Tower, in parallel to recent
global trends. A critical step can be
taken in terms of operational savings
and resource efficiency with new reg-
ulatory developments.
Superonline İletişim Hizmetleri A.Ş.
Superonline İletişim Hizmetleri A.Ş. was
established in 2004 to operate under
the Turkcell Superonline brand.
Turkcell Superonline provides services
for the purpose of making and operat-
ing the necessary investments for the
provision of telecommunication ser-
vices, and undertaking the representa-
tion of domestic and foreign busi-
nesses that provide these services. In
addition, Turkcell Superonline provides
international and national mass voice
transportation, providing private inter-
national rental data line for corpora-
tions and international internet access
services, and develops individual and
corporate internet services.
In 2020, Turkcell Superonline’s rev-
enues were TRY5.5 billion, while its
EBITDA was TRY2.9 billion. As of the
end of 2020, fiber subscriber base
had reached 1.7 million. As of the end
of 2020, Superonline provides fiber
access to 3.8 million homepass with
approximately 50 thousand km roll-
out, in 23 cities. Turkcell Superonline
fiber data acccesses to households
at speeds up to 10 Gbps. Turkcell Su-
peronline, already shares its fiber in-
frastructure with Türksat and Voda-
fone Turkey through the infrastructure
sharing cooperation agreements, and
can provide internet service to more
homepass.
Superonline has been authorized by
ICTA to provide Internet Providing Ser-
vice, Fixed Telephone Service, Infra-
structure Management Service, Sat-
ellite Communication Service, Cable
Broadcast Service and Virtual Mobile
Network Service. According to the
regulations of the ICTA, authorizations
can be definite term or indefinite de-
pending on the type; definite term au-
thorizations can be extended by mak-
ing a renewal application to the ICTA
in a certain period before the end of
the authorization.
Turkcell Finansman
Established in March 2016, Turkcell
Finansman A.Ş. provides financing
solutions to corporate and individual
customers as part of their purchas-
es of technology-based services and
products under the “Financell” brand.
Financell is in the leader position with
the highest customer number in the
nonbank financial sector.
Financell serves its customers through
around 1,300 Turkcell stores, 2,092
DSN+ (digital sales points) stores and
digital sales channels in Turkey.
Turkcell Finansman which has an as-
set size of TRY2.5 billion as at the end
of 2020 has granted TRY18 billion in
loans to around 5.6 million customers
to date, become one of the key play-
ers in the Turkish financing sector. Fi-
nancell extended its services into the
corporate lending market with its dig-
ital transformation loan. Through the
credit risk and digital systems trans-
formation projects carried out in 2020,
Turkcell Finansman performs credit
application assessments more rapid-
ly and continues to manage its credit
risk effectively. With the projects com-
pleted in 2020, financing services have
also started to be provided to Corpo-
rate and Superonline customers. Thus,
Financell provides financing solutions
for all products and services sold by
the Turkcell Group.
The company recently established a
new techfin initiative, Turkcell Sigorta
Aracılık Hizmetleri A.Ş., which aims to
offer innovative solutions for customer
risk management in risk management
area with fast and easy-to-access
products. In this context, customers
have the opportunity to readily access
and purchase insurance products from
all Turkcell channels, including call
centers, digital channels, and dealers.
Turkcell Sigorta meets the insurance
needs of customers by offering life in-
surance and device insurance, its main
products, to individual customers who
receive financing through Financell.
Moreover, the personal accident in-
surance product has been introduced
in 2020. The first end-to-end digi-
tal sales via QR code in Turkey have
been realized, in addition to sales via
the call center and store channels. It
aims to secure its place in the mar-
ket as a pioneering player in the field
of insurtech with new and innovative
optional insurance products to be
launched in the future.
Turkcell Ödeme Hizmetleri ve
Elektronik Para Hizmetleri - Paycell
Turkcell Ödeme ve Elektronik Para
Hizmetleri A.Ş. (TÖHAŞ) extended the
scope of its operational permit ob-
tained from the BRSA in 2016, with an
E-Money license in 2017. With a rap-
id techfin transformation having tak-
en place worldwide over the past 10
years, the Turkey market offers great
potential for techfin services to ex-
pand through its attractive internal
dynamics. In particular, the high young
population, high smart device pene-
tration rate, approximately 30 million
unbanked potential users, still-high
rate of cash use in shopping and in-
*We hold an 33% stake.
creasing e-commerce volume stand
out as factors that will support the
rapid rise in the penetration of tech-
fin solutions. The COVID-19 pandem-
ic that has impacted the world since
the start of 2020 has accelerated this
transformation. Particularly, chang-
ing living conditions and needs led to
increased customer focus on digital
platforms. E-commerce was one of
the sectors most positively affected.
In accordance with these needs and
changing customer habits, our vision
with Paycell is to enable more users to
readily benefit from financial services
through fast and secure payment solu-
tions that we created by combining
technology with financial services.
In 2020, Paycell continued to improve
the products and services that it offers
to its customers. Paycell, which serves
over 12 thousand contracted mer-
chants, expanded its solution portfolio
for commercial businesses with the
Android POS this year. Paycell Android
POS, the first Android POS device to
comply with relevant legislation, and
registered by the Turkish Revenue
Administration, provides cost and ef-
ficiency advantages to member mer-
chants, while offering collection, stock
tracking and e-invoice processes on
a single platform. Paycell closed the
year of 2020 with great success on
the strength of these activities consid-
ering the needs of its customers, and
continued to lead the techfin industry
by reaching record transaction vol-
umes in various products. While Pay-
cell customers reached 4.7 million in
2020, the Paycell application, enriched
with new functions, exceeded 9 mil-
lion downloads. The total transaction
volume through Paycell reached TRY9
billion.
Sofra Kurumsal ve Ödüllendirme
Hizmetleri A.Ş.*
Sofra Kurumsal ve Ödüllendirme Hiz-
metleri A.Ş. is a meal card company
established in 2018 in partnership with
Turkcell, Belbim and PTT. It serves under
the Paye Card brand. Paye Card has
reached more than 16 thousand mer-
chants across Turkey.
The Paye meal card is the first one that
can be used on transportation. Paye
Card, which is a contactless card, can
be used at all points where the Istanbul
Card is valid, aside from its meal card
feature.
Paye offers an easy payment service
that allows employees to save time
while paying for their meals through
its contactless payment feature. Paye
Card offers fast and easy payment
with the QR method at contracted
stores and market chains with Paycell
QR payment infrastructure.
Turkcell Teknoloji
Turkcell Teknoloji has been contribut-
ing to the development of the tech-
nology infrastructure of Turkcell, the
leader telecommunication company
of Turkey, since 2006, and offers its
innovative solutions for the use of op-
erators abroad. Within the framework
of Turkcell’s strategy to expand its
products and services into internation-
al markets, Turkcell Teknoloji aims to
develop new digital and ICT services
in global statandards in line with the
latest technology and market require-
ments, and to expand in regions where
Turkcell Group operates. Products and
services developed by Turkcell Te-
knoloji serve over 100 million users in
15 countries today.
As one of Turkey’s largest and most
competitive R&D centers with over
1,000 R&D engineers as of 2020,
Turkcell Teknoloji marked numerous
achievements both in Turkey and the
wider world. Turkcell Teknoloji aims
to develop innovative technologies
in communications and in the areas
where it has an impact. The compa-
ny also targets to be a leader, pioneer,
and role model in Turkey by employing
the most talented human capital in the
R&D industry to the greatest possible
extent. With the experience accumu-
lated throughout the transformation
of Turkcell from a technology-oriented
network provider to a service-oriented
experience provider, Turkcell Teknoloji
strives to be an R&D center with inno-
vative solutions developed for domes-
TURKCELL INTEGRATED ANNUAL REPORT 2020
TURKCELL INTEGRATED ANNUAL REPORT 2020
251
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252
tic and international markets.
Turkcell Teknoloji focuses on roaming
solutions, big data processing, busi-
ness intelligence applications, smart
cloud platform and platform-devel-
oped solutions, location based ser-
vices and platforms, customer rela-
tionship management and solutions,
network management solutions, next
generation value added services, mo-
bile financial systems, music and en-
tertainment services, IPTV services,
mobile marketing solutions, Internet
of Things (IoT), geographic informa-
tion systems, voice identification, AR/
VR, 5G infrastructure projects, mobile
communication solutions, campaign
management systems, smart Sim card
solutions, digital identity technologies,
image and video processing based
on artificial intelligence, text analy-
sis (NLP), suggestion engines, voice
analytics, robot assistants, robotics
process automation, mobile analyti-
cal platforms, artificial intelligence in
health, learning and education appli-
cations solutions, e-mail and search
engine solutions, digital broadcast
solutions, CDN (Content Delivery Net-
work) solutions, Over-the-Top (OTT)
and blockchain solutions.
Turkcell Teknoloji is the leader in the
telecommunications sector in Turkey
with 2,674 national and 167 interna-
tional patent applications and more
than 700 registered patents since
2008. Leading the development of
new technologies, Turkcell Teknoloji
issued 23 academic and 95 technical
publications on national and interna-
tional platforms in 2020 which posi-
tively impacted the increased use of
technology. Moreover, the technology
experience of the ecosystem has been
increased by sustained intensive prod-
uct promotion, conference participa-
tion and training activities over various
channels.
Lifecell Ventures
Established as a 100% Turkcell sub-
sidiary
in the Netherlands, Lifecell
Ventures’s mission is to offer digital
communication, content-based enter-
tainment, music, TV applications and
technology solutions developed by
Turkcell Group companies and tech-
nology partners to the global market.
In 2017, the company launched its first
international digital solution partner-
ship with the Eastern Europe opera-
tor Moldcell with its “BiP” and “lifebox”
products. lifecell Ventures expanded
digital solution partnerships in 2019
through the launch of “BiP” and “life-
box” with ALBtelecom, the Albanian
mobile operator. With the agreement
signed with Lifecell Ventures in Jan-
uary 2019, Digicel launched BiP, Billo
(lifebox) and PlayGo (TV+) products in
32 countries in the Caribbean, Central
America, and Asia Pacific regions as
of fourth quarter 2020, adding them
to its digital services portfolio. Digicel
is also able to follow trends instantly
Türkiye’nin Otomobili Girişim Grubu
Sanayi Ve Ticaret A.Ş.
Türkiye’nin Otomobili Girişim Grubu
Sanayi ve Ticaret A.Ş. (TOGG) was
established on June 25, 2018 within
the framework of Turkey’s Automobile
Project implemented through the co-
ordination of The Republic of Turkey
Ministry of Industry and Technology
and The Union of Chambers and Com-
modity Exchanges of Turkey. As one of
the founding partners of this compa-
ny with a 19% shareholding, we aim to
be involved in fields promising great
potential such as connected vehicles,
smart cities and intelligent transpor-
tation. TOGG, aiming to develop new
generation electric and connected
cars and to create a mobility eco-
system around those, communicated
the progress achieved in design and
engineering work to public and in-
troduced the C-SUV concept vehicle
along with C-Sedan model at the un-
veiling ceremony in December 2019.
The ground-breaking ceremony of the
factory took place in Gemlik / Bursa
on July 18, 2020. The construction of
the factory, where fully electric SUVs
in 2022 and then sedan models will
be manufactured, is aimed for com-
pletion within 18 months. We will con-
tinue to support the electric powered
and brand-new automobile platform
which is also in-line with Turkcell’s sus-
tainability focus.
with RTM (Real Time Monitoring Solu-
tion) and RTA (Real Time Action Solu-
tion) technology solutions, and has
gained the competence to make the
best offer to its customers. Lifecell
Ventures makes a significant contri-
bution to digital export targets by in-
creasing the penetration of digital ser-
vices and technology solutions, and by
providing strong business partnerships
all over the world.
Turkcell Enerji Çözümleri ve Elektrik
Satış Ticaret A.Ş. (Turkcell Energy
Solutions)
Having commenced its operations in
2018 with the “Enerjicell” brand, Turk-
cell Enerji Çözümleri ve Elektrik Satış
Ticaret A.Ş., became one of the most
important free-market electricity sup-
pliers in Turkey in terms of the number
of registered counters in 2019 serving
its retail and corporate customers. En-
erjicell, which focused on corporate
customers in 2020, aims to change
towards creating
existing practice
customer experience in the industry
through its superior service quality.
Continuing its retail electricity service
business, Enerjicell also expanded its
business into renewable energy gen-
eration in 2019. Throughout the year,
Enerjicell pioneered renewable energy
investments in Turkcell’s buildings with
self-generated electricity consump-
tion model. The company engaged
in and completed rooftop solar panel
projects, including the one in newly es-
tablished Ankara datacenter. Planning
to continue its renewable energy in-
vestments in the coming years, Ener-
jicell aims to transform Turkcell into a
company, which will have carbon free
emissions and generate electricity
from environmentally-friendly resourc-
es.
Turkcell Sales and Digital Business
Services
Turkcell Digital Services was estab-
lished in early January 2019 in order
to accompany our customers on their
digital transformation journey and lead
them as a strategic technology part-
ner in this field by adding IT compe-
tencies to Turkcell’s superior telecom
infrastructure and competencies. As
one of the companies most invested in
Turkey’s human resources and technol-
ogies, our main goal is to be a reliable
technology partner that provides end-
to-end, key solutions to our customers.
We provide services in many different
areas, including access services, cloud
technologies, data center services,
cyber security services, managed ser-
vices, internet of things, big data an-
alytics, business applications, sectoral
solutions, and new generation technol-
ogies, which we offer to our custom-
ers on our strong infrastructure. While
satisfying the telecommunication and
IT needs of corporations with Turkcell
assurance, expertise, and difference,
we will remain motivated to further
improving our service quality and de-
veloping products and services day
by day in accordance with needs and
expectations of our customers. We will
continue to achieve this by leveraging
our superior infrastructure, technology
investments and highly-skilled human
capital. By integrating our customers’
existing infrastructure investments with
new generation services, we build and
implement their future technology in-
vestments together. This allows our
customers to advance on their digital
transformation journey with the most
appropriate financial model and with
new technology investment plans, en-
abling them to focus more on their
own business.
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
254
Subsequent events after
the reporting period
January 08, 2021
Announcement Regarding the Decision to Issue Lease Certificates
Our Company’s Board of Directors resolved that our wholly owned subsidiary Turkcell Ödeme ve Elektronik Para Hizmetleri
A.Ş shall issue management agreement based lease certificates (sukuk) in accordance with capital markets legislation
through an asset leasing company at an amount of up to TRY200 million, in Turkish Lira terms, with maturities up to 12
months, in the domestic market, in one or more tranches, without public offering, as private placement and/or to be sold to
institutional investors. The respective issuance is subject to approval of Capital Markets Board.
January 11, 2021
Announcement Regarding the News in the Media - Ziraat Bank Loan
This announcement concerns news and comments in the media which reportedly includes our Company regarding a loan
granted by Ziraat Bank to a company located outside of Turkey. We neither utilized the respective loan nor we are a party
to the loan agreement directly or indirectly. In this respect, the relevant loan has no impact on our Company’s financial
statements.
January 29, 2021
Announcement Regarding Turkcell Human Rights Policy and Turkcell Environmental Policy
Our Company’s Board of Directors approved Turkcell Human Rights Policy and Turkcell Environmental Policy, which are at-
tached below.
January 29, 2021
Announcement Regarding the Board Member Appointment
Our Company’s Board of Directors has decided to appoint Ms. Figen Kılıç as a Board Member to the seat, which became
vacant following Ms. Ingrid Maria Stenmark’s resignation, pursuant to Article 363 of the Turkish Commercial Code.
February 03, 2021
Announcement Regarding the Capital Increase in Lifecell Ventures
The capital of our 100% owned subsidiary Lifecell Ventures Coöperatief U.A. (“Lifecell Ventures”) is increased by EUR
15,000,000. Our Company’s pre-emption rights with respect to the capital increase is fully paid.
March 08, 2021
Announcement Regarding the Incorporation of Turkcell Dijital İş Servisleri A.Ş.
Turkcell Dijital İş Servisleri A.Ş. with a capital of TRY 100,000, and the shares of which are fully owned by our Company’s
subsidiary Superonline İletişim Hizmetleri A.Ş. has been incorporated and registered.
The public disclosure regarding the incorporation of the company was postponed by respective board decision since it
could have impacted investment decision of investors and stock price.
Statement of compliance with corporate
governance principles for the year 2020
Turkcell İletişim Hizmetleri A.Ş. (“Turkcell” or the “Company”) is aware of its responsibilities towards its stakeholders, with the
belief that high standards of corporate governance are key to maintain successful business practices and to provide long-
term economic value to the company’s shareholders. Within this framework, having adopted the principles of “equality,”
“transparency,” “accountability” and “responsibility” that constitute the basis of corporate governance in its activities, the
Company exercises due diligence with regard to compliance with the Capital Markets Law (“CML”) and the secondary reg-
ulations and resolutions of the Capital Markets Board (“CMB”).
In parallel with corporate governance efforts established with the creation of the Investor Relations Department at the time
of the IPO, and gained momentum in 2003, corporate governance mechanisms are being implemented in line with the cor-
porate governance principles.
Turkcell İletişim Hizmetleri A.Ş. places a great importance on the full compliance with Corporate Governance Principles.
In the activity period that ended as of 31 December 2020, as the amendments in the articles of association provided the
legal ground for the election of independent board members in the following general assembly meetings, our company aims
full compliance with the partially complied principle numbered 4.3.7, as mandated in the annexes of the Corporate Govern-
ance Communiqué and in the relevant legislation.
On 21 October 2020, the following main amendments to the articles of association regarding corporate governance have
been approved by the ordinary general assembly:
(i) The size of the board of directors has been increased from seven members to a total of nine members;
(ii) 15% of the total issued shares of Turkcell, owned by TVF Bilgi Teknolojileri İletişim Hizmetleri Yatırım Sanayi ve Ticaret
Anonim Şirketi (“TVF BTIH”) as the surviving entity from the Turkcell Holding A.S. (“Turkcell Holding”) / TVF BTIH merger,
have been re-classified as a separate class of Group A Shares (the “Group A Shares”);
(iii) A nomination privilege has been created on the Group A Shares, allowing the holders thereof to nominate four
candidates for appointment of five members of the board of directors of the Company; a voting privilege has been
created on the Group A Shares, allowing the holders thereof to cast six votes for each Group A Share in respect of
the appointment of a. five members of the board of directors of the Company, and b. the chairman of the presiding
committee of the general assembly of shareholders;
(iv) All shareholders of the Company (including the holders of Group A Shares) are entitled to cast one vote per share on
all other matters submitted to a vote of Turkcell’s shareholders, including the appointment of the residual four mem-
bers of the board of directors of Turkcell (including independent ones);
(v) The chairman of the board of directors shall be elected among the members of the board of directors elected through
the exercise of the privileges granted to Group A Shares;
(vi) The meeting quorum requirement of the board of directors requires five members constituting the majority of full
number of its members, and the decision quorum requires the affirmative vote of at least five members present in
the meeting;
(vii) A new article “Compliance with Corporate Governance Principles” is added to the articles of association.
Although full compliance with non-mandatory corporate governance principles provided for in the relevant legislation is
aimed, it has yet to be achieved due to the challenges in the implementation of certain principles, the incompatibilities be-
tween some principles and the current structure of the Company and the market.
Currently, the principles yet to be fully complied with so far have not led to any conflicts of interest between the stakeholders.
In the activity period that ended as of 31 December 2020, necessary explanations are provided in the annual report; (i) the
Corporate Governance Compliance Report (“CGCR”) and (ii) the Corporate Governance Fact Sheet (“CGFS”) and (iii) other
relevant sections of the annual report as to the corporate governance principles in the annexes of the Communiqué on Cor-
porate Governance with which the compliance is achieved as well as the ones that are not yet complied with.
Taking into account the amendments of the regulations and the practices, future efforts will continue to improve our corpo-
rate governance practices including the limited number of unimplemented principles and, to ensure, within the framework
of these principles, the better operation of the mechanisms with respect to the corporate governance practices of the
partnership.
Should the CGCR or CGFS be amended within the activity period, a material event disclosure will be made, and this amend-
ment will be included in the interim activity reports.
255
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256
2020 financial year Corporate
Governance Compliance Report
Company Compliance Status
Yes
Partial
No Exempted
Not
Applicable
Explanation
Company Compliance Status
Yes
Partial
No Exempted
Not
Applicable
Explanation
1.1. FACILITATING THE EXERCISE OF SHAREHOLDER
RIGHTS
1.1.2 - Up-to-date information and disclosures
which may affect the exercise of shareholder
rights are available to investors at the corporate
website.
1.2. RIGHT TO OBTAIN AND REVIEW INFORMATION
1.2.1- Management did not enter into any
transaction that would complicate the conduct
of special audit.
1.3. GENERAL ASSEMBLY
1.3.2- The company ensures the clarity of the
General Assembly agenda, and that an item on
the agenda does not cover multiple topics.
1.3.7- Insiders with privileged information
have informed the board of directors about
transactions conducted on their behalf within
the scope of the company’s activities in order
for these transactions to be presented at the
General Shareholders’ Meeting.
1.3.8- Members of the board of directors who
are concerned with specific agenda items,
auditors, and other related persons, as well
as the officers who are responsible for the
preparation of the financial statements were
present at the General Shareholders’ Meeting.
X
X
X
X
1.3.10- The agenda of the General Shareholders’
Meeting included a separate item detailing the
amounts and beneficiaries of all donations and
contributions.
X
1.3.11 - The General Shareholders’ Meeting
was held open to the public, including the
stakeholders, without having the right to speak.
X
1.4. VOTING RIGHTS
1.4.1 - There is no restriction preventing
shareholders from exercising their shareholder
rights.
X
X
No information regarding
this kind of activities were
received from such person
following the routine
information requests
made before the general
assembly meetings.
Donations and charities
are included seperately
on the general assembly
agenda; but information
regarding the amount
and beneficiaries of these
donations and charities
are given separetely in
the general assembly
meeting within the scope
of shareholders’ right to
obtain information.
Results of general
assembly meeting
has been shared
with the media
through press
release.
X
X
1.4.2-The company does not have shares that
carry privileged voting rights.
1.4.3- The company withholds from exercising
its voting rights at the General Shareholders’
Meeting of any company with which it has
cross-ownership, in case such cross-ownership
provides management control.
1.5. MINORITY RIGHTS
1.5.1- The company pays maximum diligence to
the exercise of minority rights.
1.5.2- The Articles of Association extend the use
of minority rights to those who own less than
one twenthieth of the outstanding shares, and
expand the scope of the minority rights.
1.6. DIVIDEND RIGHT
1.6.1 - The dividend policy approved by the
General Shareholders’ Meeting is posted on the
company website.
1.6.2 - The dividend distribution policy comprises
the minimum information to ensure that the
shareholders can have an opinion on the
procedure and principles of dividend distributions
in the future.
1.6.3 - The reasons for retaining earnings, and
their allocations, are stated in the relevant
agenda item.
1.6.4 - The board reviewed whether the dividend
policy balances the benefits of the shareholders
and those of the company.
X
X
X
X
X
1.7. TRANSFER OF SHARES
1.7.1 - There are no restrictions preventing shares
from being transferred.
X
2.1. CORPORATE WEBSITE
2.1.1 - The company website includes all elements
listed in Corporate Governance Principle 2.1.1.
X
Please see AoA: Article
7.2 and 7.3 https://s.
turkcell.com.tr/SiteAssets/
Hakkimizda/yatirimci-
iliskileri/documents/pdf/
Anasozlesme21102020_
ENG.pdf
Tresholds determined by
the respective legislation
are in effect.
X
Turkcell distributed
dividend in 2020.
Without prejudice to 137/3,
due to Article 7.5 of the
AoA we ticked the “Partial”
box.
257
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
258
Company Compliance Status
Yes
Partial
No Exempted
Not
Applicable
Explanation
Company Compliance Status
Yes
Partial
No Exempted
Not
Applicable
Explanation
2.1.2- The shareholding structure (names,
privileges, number and ratio of shares, and
beneficial owners of more than 5% of the issued
share capital) is updated on the website at least
every 6 months.
2.1.4 - The company website is prepared in other
selected foreign languages, in a way to present
exactly the same information with the Turkish
content.
2.2. ANNUAL REPORT
2.2.1 - The board of directors ensures that the
annual report represents a true and complete
view of the company’s activities.
2.2.2 - The annual report includes all elements
listed in Corporate Governance Principle 2.2.2.
3.1. CORPORATION’S POLICY ON STAKEHOLDERS
3.1.1- The rights of the stakeholders are protected
pursuant to the relevant regulations, contracts
and within the framework of bona fides
principles.
3.1.3 - Policies or procedures addressing
stakeholders’ rights are published on the
company’s website.
3.1.4 - A whistleblowing programme is in place
for reporting legal and ethical issues.
3.1.5 - The company addresses conflicts of
interest among stakeholders in a balanced
manner.
3.2. SUPPORTING THE PARTICIPATION OF
THE STAKEHOLDERS IN THE CORPORATION’S
MANAGEMENT
3.2.1 - The Articles of Association, or the internal
regulations (terms of reference/manuals),
regulate the participation of employees in
management.
3.2.2 - Surveys/other research techniques,
consultation, interviews, observation method
etc. were conducted to obtain opinions from
stakeholders on decisions that significantly affect
them.
X
X
X
X
X
X
X
X
X
X
(Communique on
Material Events Disclosure
Article-16/2) Central
Securities Depository is
updating the respective
information available in
PDP under the General
Information heading.
We also disclose these
information as sourced by
CSD on our website.
Corporate web site
related to public is
available in English, Arabic
and Russian language in
addition to that Investor
Relations page is provided
both in Turkish and in
English.
Employees’ participation
to the management is
facilitated through internal
regulations of the compa-
ny and various company
practices.
3.3. HUMAN RESOURCES POLICY
3.3.1 - The company has adopted an
employment policy ensuring equal opportunities,
and a succession plan for all key managerial
positions.
3.3.2 - Recruitment criteria are documented.
3.3.3 - The company has a policy on human
resources development, and organises trainings
for employees.
3.3.4 - Meetings have been organised to
inform employees on the financial status of
the company, remuneration, career planning,
education and health.
3.3.5 - Employees, or their representatives, were
notified of decisions impacting them. The opinion
of the related trade unions was also taken.
3.3.6 - Job descriptions and performance
criteria have been prepared for all employees,
announced to them and taken into account to
determine employee remuneration.
3.3.7 - Measures (procedures, trainings, raising
awareness, goals, monitoring, complaint
mechanisms) have been taken to prevent
discrimination, and to protect employees
against any physical, mental, and emotional
mistreatment.
3.3.8 - The company ensures freedom of
association and supports the right for collective
bargaining.
3.3.9 - A safe working environment for
employees is maintained.
3.4. RELATIONS WITH CUSTOMERS AND SUPPLIERS
3.4.1- The company measured its customer
satisfaction, and operated to ensure full
customer satisfaction.
3.4.2 - Customers are notified of any delays in
handling their requests.
3.4.3 - The company complied with the quality
standards with respect to its products and
services.
3.4.4 - The company has in place adequate
controls to protect the confidentiality of sensitive
information and business secrets of its customers
and suppliers.
X
X
X
X
X
X
X
X
X
X
X
X
X
We do not have a
syndicate.
259
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
260
Company Compliance Status
Yes
Partial
No Exempted
Not
Applicable
Explanation
Company Compliance Status
Yes
Partial
No Exempted
Not
Applicable
Explanation
3.5. ETHICAL RULES AND SOCIAL RESPONSIBILITY
3.5.1 - The board of the corporation has adopted
a code of ethics, disclosed on the corporate
website.
3.5.2- The company has been mindful of its
social responsibility and has adopted measures
to prevent corruption and bribery.
4.1. ROLE OF THE BOARD OF DIRECTORS
4.1.1- The board of directors has ensured
strategy and risks do not threaten the long-term
interests of the company, and that effective risk
management is in place.
4.1.2- The agenda and minutes of board
meetings indicate that the board of directors
discussed and approved strategy, ensured
resources were adequately allocated, and
monitored company and management
performance.
4.2. ACTIVITIES OF THE BOARD OF DIRECTORS
4.2.1- The board of directors documented its
meetings and reported its activities to the
shareholders.
4.2.2- Duties and authorities of the members of
the board of directors are disclosed in the annual
report.
4.2.3 - The board has ensured the company has
an internal control framework adequate for its
activities, size and complexity.
4.2.4- Information on the functioning and
effectiveness of the internal control system is
provided in the annual report.
4.2.5 - The roles of the Chairman and Chief
Executive Officer are separated and defined.
4.2.7-The board of directors ensures that the
Investor Relations department and the corporate
governance committee work effectively.
The board works closely with them when
communicating and settling disputes with
shareholders..
4.2.8 - The company has subscribed to a
Directors and Officers liability insurance covering
more than 25% of the capital.
X
X
X
X
X
X
X
X
X
X
X
Since duties and
responsibilities of the
Board of Directors are
determined by the
Commercial Code we do
not have specific chapter
in our annual report
regarding this topic.
The roles of chairman and
chief executive officer our
Company is seperate.
This year’s policy limit for
Directors and Officers
liabiliy did not exceed 25%
of the company capital.
X
We do not have a policy
which restrains female
candidates from being
appointed as a board
member.
Due to the epidemic, all
members attended the
meetings either online or
physically.
4.3. STRUCTURE OF THE BOARD OF DIRECTORS
4.3.9- The board of directors has approved
the policy on its own composition, setting a
minimal target of 25% for female directors. The
board annually evaluates its composition and
nominates directors so as to be compliant with
the policy.
4.3.10 - At least one member of the audit
committee has 5 years of experience in audit/
accounting and finance.
4.4. BOARD MEETING PROCEDURES
4.4.1 - Each board member attended the
majority of the board meetings in person.
4.4.2 - The board has formally approved a
minimum time by which information and
documents relevant to the agenda items should
be supplied to all board members.
4.4.3 - The opinions of board members that
could not attend the meeting, but did submit
their opinion in written format, were presented to
other members.
4.4.4 - Each member of the board has one vote.
4.4.5 - The board has a charter/written internal
rules defining the meeting procedures of the
board.
4.4.6 - Board minutes document that all items on
the agenda are discussed, and board resolutions
include director’s dissenting opinions if any.
X
X
X
X
X
X
X
4.4.7 - There are limits to external commitments
of board members. Shareholders are informed
of board members’ external commitments at the
General Shareholders’ Meeting.
X
There is no rule which
restricts board member
to serve outside the
company.
261
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
262
Company Compliance Status
Yes
Partial
No Exempted
Not
Applicable
Explanation
4.5. BOARD COMMITTEES
4.5.5 - Board members serve in only one of the
Board’s committees.
4.5.6- Committees have invited persons to the
meetings as deemed necessary to obtain their
views.
4.5.7 - If external consultancy services are used,
the independence of the provider is stated in the
annual report.
4.5.8 - Minutes of all committee meetings are
kept and reported to board members.
4.6. FINANCIAL RIGHTS
4.6.1 - The board of directors has conducted
a board performance evaluation to review
whether it has discharged all its responsibilities
effectively.
4.6.4 - The company did not extend any loans to
its board directors or executives, nor extended
their lending period or enhanced the amount of
those loans, or improve conditions thereon, and
did not extend loans under a personal credit title
by third parties or provided guarantees such as
surety in favour of them.
X
X
X
4.6.5 - The individual remuneration of board
members and executives is disclosed in the
annual report.
X
X
X
Due to the number of
the board of members,
they are serving as a
committee member in
more than one comittee.
X
No service has been
received from an outside
counsel in 2020.
Board of Directors’
performance has not been
evaluated.
Aggregate amount of the
remuneration of board
members and executives
is disclosed in the annual
report.
Corporate Governance Information Form
1. SHAREHOLDERS
1.1. Facilitating the Exercise of Shareholders Rights
The number of investor meetings (conference, seminar/etc.) organised by the
company during the year
1.2. Right to Obtain and Examine Information
The number of special audit request(s)
The number of special audit requests that were accepted at the General
Shareholders’ Meeting
1.3. General Assembly
Link to the PDP announcement that demonstrates the information requested
by Principle 1.3.1. (a-d)
Whether the company provides materials for the General Shareholders’
Meeting in English and Turkish at the same time
The links to the PDP announcements associated with the transactions that
are not approved by the majority of independent directors or by unanimous
votes of present board members in the context of Principle 1.3.9
The links to the PDP announcements associated with related party
transactions in the context of Article 9 of the Communique on Corporate
Governance (II-17.1)
The links to the PDP announcements associated with common and
continuous transactions in the context of Article 10 of the Communique on
Corporate Governance (II- 17.1)
The name of the section on the corporate website that demonstrates the
donation policy of the company
The relevant link to the PDP with minute of the General Shareholders’ Meeting
where the donation policy has been approved
In 2020, Investor Relations Department
attended 19 investor conferences, 15 of
which was held virtually and 4 was physi-
cally and held 506 meetings in total with
analysts and corporate investment funds.
0
0
https://www.turkcell.com.tr/en/aboutus/
investor-relations/corporate-governance/
general-assembly-information
Provided in English as well.
No transaction has been executed in the
context of Principle 1.3.9
No related party transactions has been
executed above the tresholds.
No related party transactions has been
executed above the treshold.
https://www.turkcell.com.tr/en/aboutus/
investor-relations/corporate-governance/
donation-policy
https://www.kap.org.tr/en/Bildirim/517918
The number of the provisions of the articles of association that discuss the
participation of stakeholders to the General Shareholders’ Meeting
Identified stakeholder groups that participated in the General Shareholders’
Meeting, if any
Not available.
Not available.
1.4. Voting Rights
Whether the shares of the company have differential voting rights
Yes
In case that there are voting privileges, indicate the owner and percentage of
the voting majority of shares.
Please see AoA: Article 7.2 and 7.3
https://s.turkcell.com.tr/SiteAssets/
Hakkimizda/yatirimci-iliskileri/documents/
pdf/Anasozlesme21102020_ENG.pdf
The percentage of ownership of the largest shareholder
26.2%
1.5. Minority Rights
Whether the scope of minority rights enlarged (in terms of content or the
ratio) in the articles of the association
No
If yes, specify the relevant provision of the articles of association.
Not available.
1.6. Dividend Right
The name of the section on the corporate website that describes the
dividend distribution policy
Minutes of the relevant agenda item in case the board of directors proposed
to the general assembly not to distribute dividends, the reason for such
proposal and information as to use of the dividend.
PDP link to the related general shareholder meeting
minutes in case the board of directors proposed to the general assembly not
to distribute dividends.
https://www.turkcell.com.tr/en/aboutus/
investor-relations/corporate-governance/
dividend-policy
Dividends are distributed in 2020.
Dividends are distributed in 2020.
263
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
264
General Assembly Meetings
The number
of information
requests
received by
the company
regarding the
clarification
of the agenda
of the General
Shareholders’
Meeting
General
Meeting
Date
Shareholder
participation
rate to the
General
Shareholders’
Meeting
Percentage
of shares
directly
present at
the GSM
Percentage
of shares
represented
by proxy
Specify the name of the page of the corporate
website that contains the General Shareholders’
Meeting minutes, and also indicates for each
resolution the voting levels for or against
Specify the
name of the
page of the
corporate
website that
contains all
questions asked
in the general
assembly
meeting and
all responses to
them
The number
of the relevant
item or
paragraph
of General
Shareholders’
Meeting
minutes in
relation to
related party
transactions
The number of
declarations
by insiders
received by
the board of
directors
3. STAKEHOLDERS
3.1. Corporation’s Policy on Stakeholders
The name of the section on the corporate website that demonstrates the
employee remedy or severance policy
It is not disclosed in the website of the
Company.
The number of definitive convictions the company was subject to in relation to
breach of employee rights
The position of the person responsible for the alert mechanism (i.e.
whistleblowing mechanism)
7
Ethics Committee
The link to the related PDP general
shareholder meeting notification
The contact detail of the company alert mechanism
E-mail: ethicscommittee@turkcell.com.tr
Adres: Turkcell İletişim Hizmetleri A.Ş. Etik
Kurulu Aydınevler Mah. İnönü Cad. No.20,
Küçükyalı / İstanbul
21/10/2020 0
80%
0.01%
79.99%
https://s.turkcell.com.tr/SiteAssets/Hakkimizda/
yatirimci-iliskileri/documents/pdf/2019GK-
tutanak-ENG.pdf
No question
submitted
N/A
0
https://www.kap.org.tr/en/Bildirim/882825
2. DISCLOSURE AND TRANSPARENCY
2.1. Corporate Website
Specify the name of the sections of the website providing the information
requested by the Principle 2.1.1.
If applicable, specify the name of the sections of the website providing the
list of shareholders (ultimate beneficiaries) who directly or indirectly own
more than 5% of the shares.
List of languages for which the website is available
2.2. Annual Report
The page numbers and/or name of the sections in the Annual Report that
demonstrate the information requested by principle 2.2.2.
a) The page numbers and/or name of the sections in the Annual Report that
demonstrate the information on the duties of the members of the board of
directors and executives conducted out of the company and declarations on
independence of board members.
b) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on committees formed within the board
structure.
c) The page numbers and/or name of the sections in the Annual Report that
demonstrate the information on the number of board meetings in a year and
the attendance of the members to these meetings.
ç) The page numbers and/or name of the sections in the Annual Report that
demonstrate the information on amendments in the legislation which may
significantly affect the activities of the corporation.
d) The page numbers and/or name of the sections in the Annual Report
that demonstrate the information on significant lawsuits filed against the
corporation and the possible results thereof.
e) The page numbers and/or name of the sections in the Annual Report that
demonstrate the information on the conflicts of interest of the corporation
among the institutions that it purchases services on matters such as
investment consulting and rating and the measures taken by the corporation
in order to avoid from these conflicts of interest
https://www.turkcell.com.tr/en/aboutus/
investor-relations,
https://www.kap.org.tr/en/sirket-bilgileri/
genel/1103-turkcell-iletisim-hizmetleri-a-s
https://www.turkcell.com.tr/en/aboutus/
investor-relations/corporate-governance/
shareholder-structure,
https://www.kap.org.tr/en/sirket-bilgileri/
genel/1103-turkcell-iletisim-hizmetleri-a-s
Turkish, English, Arabic (Partial) and
Russian (Partial)
Information provided in the Annual Report
under Other Issues Regarding Corporate
Governance section.
Information provided in our website
under “Investor Relations>Corporate
Governance>Board Committees” heading
and in the Corporate Governance
Information Filings under section 4 which
is attached to our annual report.
Information provided in the Corporate
Governance Information Filings, which
is attached to our annual report, under
Section 4.
Information provided in the Annual
Report under Telecommunications Sector
in Turkey and Developments in Our
Company.
Information provided under note 38 of
IFRS report which is attached to our
Annual Report.
We did not receive such services in 2020.
f) The page numbers and/or name of the sections in the Annual Report that
demonstrate the information on the cross ownership subsidiaries that the
direct contribution to the capital exceeds 5%
Information provided under note 40 of
IFRS report which is attached to our
Annual Report.
g) The page numbers and/or name of the sections in the Annual Report that
demonstrate the information on social rights and professional training of the
employees and activities of corporate social responsibility in respect of the
corporate activities that arises social and environmental results
Information provided in the Annual Report
under section Our Social Values and
Relations.
3.2. Supporting the Participation of the Stakeholders in the Corporation’s
Management
Name of the section on the corporate website that demonstrates the internal
regulation addressing the participation of employees on management bodies
Corporate bodies where employees are actually represented
Not available.
Not available.
3.3. Human Resources Policy
The role of the board on developing and ensuring that the company has a
succession plan for the key management positions
The name of the section on the corporate website that demonstrates the
human resource policy covering equal opportunities and hiring principles. Also
provide a summary of relevant parts of the human resource policy.
Whether the company provides an employee stock ownership programme
The name of the section on the corporate website that demonstrates the
human resource policy covering discrimination and mistreatments and the
measures to prevent them. Also provide a summary of relevant parts of
the human resource policy.
Board of Directors, when necessary,
get involved in the procees through
Nomination Committee within the
framework of the Committee’s roles&
responsibilities.
Hiring process is carried out by taking Equal
Opportunities Policy into consideration
under the responsibility of the HR Depart-
ment. During the hiring process objective
criteria such as; a.Being Turkish citizen or
having work permit in Turkey b.Termination
of military service c.Not to be deprived from
civil rights d.Not to have a disease that will
prevent him/her from working or pose a
threat to the environment e.Not to be sen-
tenced for an infamous crime f.Not under
obligation of an involuntary servitude g.To
have a graduate degree h.To have required
skills determined specifically to the title and
role (such as experience, field of graduation,
certificate etc.) ı.”Close Relatives” (Spouses,
brothers/sisters, children, father, mother, un-
cle, maternal aunt, paternal aunt) of people
working in Turkcell Group companies may
not be employed in Turkcell Group Com-
panies. Employees with no past experience
are assessed within the special hiring pro-
grams such as GnçYtnk. External candidate
applications are made through My Career
www.turkcell.com.tr
There isn’t any employee stock
ownership programme
https://www.turkcell.com.tr/todiek/
english.html
The number of definitive convictions the company is
subject to in relation to health and safety measures
Not available.
265
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
Name of the Chairman
Name of the CEO
Bülent Aksu
Murat Erkan
If the CEO and Chair functions are combined: provide the link to the relevant
PDP announcement providing the rationale for such combined roles
CEO and Chair functions are not com-
bined.
Link to the PDP notification stating that any damage that may be caused by
the members of the board of directors during the discharge of their duties is
insured for an amount exceeding 25% of the company’s capital
No disclosures have been made since
the policy limit for Directors and Officers
liability did not exceed 25% of company
capital.
The name of the section on the corporate website that demonstrates current
diversity policy targeting women directors
Not available.
The number and ratio of female directors within the Board of Directors
1 - 14% (Our woman board member Ingrid
M. Stenmark resigned from her duty in
October 2020)
Composition of Board of Directors
Name, Surname of
Board Member
Bülent Aksu
Hüseyin Aydın
Whether
Executive
Director Or
Not
Non-
executive
Non-
executive
Whether
Independent
Director Or
Not
Not
independent
director
Not
independent
director
Link To PDP
Notification That
Includes The
Independency
Declaration
The First
Election Date
To Board
07/03/2019
Not available
08/03/2019
Not available
Whether the Independent Director
Considered By The Nomination
Committee
Not
Applicable
Not
Applicable
Tahsin Yazar
Non-
executive
Independent
director
06/03/2020
https://www.kap.org.
tr/en/Bildirim/824811
Not considered
Afif Demirkıran
Non-
executive
Independent
director
06/03/2020
https://www.kap.org.
tr/en/Bildirim/824811
Not considered
Nail Olpak
Non-
executive
Independent
director
06/03/2020
https://www.kap.org.
tr/en/Bildirim/824811
Not considered
Whether
She/He is the
Director Who
Ceased to
Satisfy The
Independence
or Not
Not
Applicable
Not
Applicable
Not
Applicable
Not
Applicable
Not
Applicable
Whether The Director Has
At Least 5 Years’ Experience
On Audit, Accounting And/Or
Finance Or Not
Yes
Yes
No
No
Yes
266
3.5. Ethical Rules and Social Responsibility
The name of the section on the corporate website that demonstrates the
code of ethics
The name of the section on the company website that demonstrates the
corporate social responsibility report. If such a report does not exist, provide
the information about any measures taken on environmental, social and
corporate governance issues.
Any measures combating any kind of corruption including embezzlement and
bribery
https://www.turkcell.com.tr/todiek/
english.html
Corporate Social Responsibility
For our Company it is essential to carry
out its activities in a fair, honest, legal
and ethical manner. Turkcell Group Anti-
Bribery and Corruption (“ABC”) Policy
demonstrates and reflects our Company’s
Board of Director’s commitment to
the highest prevailing national and
international anti-corruption and bribery
standards. Turkcell expects the same
degree of commitment from group
companies as well. Within the main
framework of the ABC Policy; in April 2018
Corporate Governance & ABC Program
Office has been established and an
ABC program which provides necessary
risk based trainings and establishes
internal communication, and takes
necessary preventive measures to ensure
compliance with the rules has been
initiated. With the establishment of the
ABC Office, direct and efficient channels
have been designed to access the
Board of Directors, its committees and
Senior Management with respect to ABC
compliance related matters. ABC Office
is the first contact point so that values
and processes set by the ABC Program
to be understood well and set these in
motion along with Company’s dynamics.
(Please see https://www.turkcell.com.tr/
en/aboutus/investor-relations/corporate-
governance/anti-bribery-and-corruption-
policy to obtain more information on our
ABC Policy). Starting from 1 January 2021,
Corporate Governance & ABC Program
Office continues its activities under the
title of “Corporate Governance & Capital
Markets Compliance Directorate” with
the same direct reporting to Board and
autonomous structure.
4. BOARD OF DIRECTORS-I
4.2. Activity of the Board of Directors
Date of the last board evaluation conducted
No evaluation has been conducted.
Whether the board evaluation was externally facilitated
Whether all board members released from their duties at the GSM
No
Yes
Name(s) of the board member(s) with specific delegated duties and
authorities, and descriptions of such duties
There is no executive member within
the Board of Directors and all board
members have A group
signature authorization.
Number of reports presented by internal auditors to the audit committee or
any relevant committee to the board
12
Specify the name of the section or page number of the annual report that
provides the summary of the review of the effectiveness of internal controls
Information provided in the Annual Report
under Efficient Risk and Crisis
Management section.
267
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268
4. BOARD OF DIRECTORS-II
4.4. Meeting Procedures of the Board of Directors
Number of physical board meetings in the reporting period
(meetings in person)
Director average attendance rate at board meetings
Whether the board uses an electronic portal to support its work or not
8
100%
No
Number of minimum days ahead of the board meeting to provide information
to directors, as per the board charter
5 days before the meeting.
The name of the section on the corporate website that demonstrates
information about the board charter
We do not disclose the charter in the
company’s website.
Number of maximum external commitments for board members as per the
policy covering the number of external duties held by directors
We do not have such policy.
4.5. Board Committees
Page numbers or section names of the annual report where information
about the board committees are presented
Link(s) to the PDP announcement(s) with the board committee charters
Information provided in our website
under “ Investor Relations> Corporate
Governance> Board Committees”
heading and in the Corporate
Governance Information Filings under
section 4 which is attached to our annual
report.
https://www.turkcell.com.tr/en/aboutus/
investor-relations/corporate-governance/
board-committees
Composition of Board Committees-I
Names Of The Board Committees
Name Of Committees
Defined As “ Other” In The
First Column
Name-Surname
of Committee
Members
Whether
Committee
Chair Or Not
Whether Board Member
Or Not
Audit Committee
Audit Committee
Audit Committee
Corporate Governance Committee
Corporate Governance Committee
Corporate Governance Committee
Corporate Governance Committee
Nomination Committee
Nomination Committee
Nomination Committee
Early Detection of Risk Committee
Early Detection of Risk Committee
Early Detection of Risk Committee
Remuneration Committee
Remuneration Committee
Remuneration Committee
Nail Olpak
Afif Demirkıran
Tahsiz Yazar
Tahsin Yazar
Nail Olpak
Yes
No
No
Yes
No
Board member
Board member
Board member
Board member
Board member
Ali Serdar Yağcı No
Not board member
Emre Alpman
No
Not board member
Afif Demirkıran
Yes
Board member
Bülent Aksu
Tahsin Yazar
Tahsin Yazar
No
No
Yes
Board member
Board member
Board member
Afif Demirkıran
No
Board member
Hüseyin Aydın
Tahsin Yazar
Bülent Aksu
Nail Olpak
No
Yes
No
No
Board member
Board member
Board member
Board member
4. BOARD OF DIRECTORS-III
4.5. Board Committees-II
Specify where the activities of the audit committee are presented in your
annual report or website (Page number or section name in the annual report/
website)
Specify where the activities of the corporate governance committee are
presented in your annual report or website (Page number or section name in
the annual report/website)
Specify where the activities of the nomination committee are presented in
your annual report or website (Page number or section name in the annual
report/website)
Specify where the activities of the early detection of risk committee are
presented in your annual report or website (Page number or section name in
the annual report/website)
Specify where the activities of the remuneration committee are presented in
your annual report or website (Page number or section name in the annual
report/website)
Not available in the annual report. Please
see: https://www.turkcell.com.tr/en/
aboutus/investor-relations/corporate-
governance/board-committees
Not available in the annual report. Please
see: https://www.turkcell.com.tr/en/
aboutus/investor-relations/corporate-
governance/board-committees
Not available in the annual report. Please
see: https://www.turkcell.com.tr/en/
aboutus/investor-relations/corporate-
governance/board-committees
Not available in the annual report. Please
see: https://www.turkcell.com.tr/en/
aboutus/investor-relations/corporate-
governance/board-committees
Not available in the annual report. Please
see: https://www.turkcell.com.tr/en/
aboutus/investor-relations/corporate-
governance/board-committees
4.6. Financial Rights
Specify where the operational and financial targets and their achievement
are presented in your annual report (Page number or section name in the
annual report)
Information provided in the Annual Report
under Turkcell Group: 2020 Operational
and Financial Review section.
Specify the section of website where remuneration policy for executive and
non-executive directors are presented.
https://www.turkcell.com.tr/en/aboutus/
investor-relations/corporate-governance/
compensation-policy
Specify where the individual remuneration for board members and senior
executives are presented in your annual report (Page number or section name
in the annual report)
Information provided under note 39 of
IFRS report which is attached to our
Annual Report.
Composition of Board Committees-II
Name Of Committees
Defined As “ Other” In The
First Column
Names Of
The Board
Committees
Audit Committee
Corporate Governance
Committee
Nomination Committee
Early Detection of Risk Committee
Remuneration Committee
The
Percentage
Of Non-
executive
Directors
The
Percentage Of
Independent
Directors
In The
Committee
100%
100%
50
100%
100%
100%
50%
67%
67%
67%
The Number Of
Meetings Held In
Person
The Number Of
Reports On Its
Activities Submitted To
The Board
8
2
0
6
3
8
2
0
6
3
269
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270
Other issues regarding
corporate governance
Board Member
Name-Surname
Duties Outside The Group:
Company Name
Duties Outside The Group: Title/
Position
Still Working in the
Related Company?
Ministry of Treasury and Finance of Republic
of Turkey
Deputy Minister
He left his position on
January 29, 2021.
World Bank
G20
Deputy Governor at the World
Bank
He left his position on
January 29, 2021.
Deputy Minister of Finance at G20
Asian Infrastructure Investment Bank (AIIB)
Turkey Deputy Governor at AIIB
European Bank for Reconstruction and
Development (EBRD)
Turkey Deputy Governor at EBRD
Islamic Development Bank (IsDB)
Turkey Executive Director at IDB
Asian Development Bank (ADB)
Turkey Governor at ADB
African Development Bank (AfDB)
Turkey Governor at AfDB
Economic Cooperation Organization Trade
and Development Bank (ECOBANK)
Turkey Governor at ECOBANK
Black Sea Trade and Development Bank
(BSTDB)
Turkey Governor at BSTDB
Pre-Accession Financial Cooperation Between
Our Country and the European Union
National Authorizing Officer
Bülent Aksu
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
COMCEC (ISEDAK)
National Coordination Committee
Membership
He left his position on
January 29, 2021.
Islamic Financial Services Board (IFSB)
General Assembly Membership
Financial Stability Board (FSB)
General Assembly Membership
FSB Middle East and North Africa Regional
Advisory Group (MENA)
Financial Stability and Development
Committee (FİKKO)
Ministry of Treasury and Finance - High
Disciplinary Board
Member
Member
Chairman of the Board
Financial Cooperation Coordination Board
(Directorate for EU Affairs)
Member
T. Eximbank A.Ş.
Chairman of the Board of Directors
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.
He left his position on
January 29, 2021.ww
Hüda Gıda San. Tic. Ltd. Sti
Founding Partner
Yes
Board Member
Name-Surname
Duties Outside The Group:
Company Name
Duties Outside The Group: Title/
Position
Still Working in the
Related Company?
Pak Yatirim İnşaat San. ve Tic. A.Ş.
Chairman of the Board of Directors Yes
Nora Elektrik Malzemeleri San. ve Tic. A.Ş.
Chairman of the Board of Directors Yes
Omn İnşaat San. ve Tic. A.Ş.
Chairman of the Board of Directors Yes
Avrupa Otoyolu Yatirim ve İşletme A.Ş.
Member of the Board of Directors
Kmo Anadolu Otoyol İşletmesi A.Ş.
Member of the Board of Directors
Marmara Otoyolu Yatirim ve İşletme A.Ş.
Member of the Board of Directors
Yes
Yes
Yes
Marmara Otoyol İnşaati Adi Ortakliği Ticari
İşletmesi
Member of the Board of Directors
Yes
Krp Otoyol Inşaati Adi Ortakliği Ticari İşletmesi Member of the Board of Directors
Yes
Andeva Özel Eğitim Inşaat ve Özel Sağlik
Hizmetleri A.Ş.
Company Partner
T. Eximbank A.Ş.
Member of the Board of Directors
Arikonak Elektrik Enerjisi Üretim San. ve Tic. A.Ş. Member of the Board of Directors
Naryuva Elektrik Enerjisi Üretim San. ve Tic. A.Ş. Member of the Board of Directors
Narören Elektrik Enerjisi Üretim San. ve Tic. A.Ş. Member of the Board of Directors
No
Yes
Yes
Yes
Yes
Kirkkavak Elektrik Enerjisi Üretim San. ve Tic.
A.Ş.
Nargüvem Elektrik Enerjisi Üretim San. ve Tic.
A.Ş.
Member of the Board of Directors
Yes
Member of the Board of Directors
Yes
Nail Olpak
Narboz Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Naryayla Elektrik Enerjisi Üretim San. ve Tic. A.Ş. Member of the Board of Directors
Nardeniz Elektrik Enerjisi Üretim San. ve Tic. A.Ş. Member of the Board of Directors
Narkas Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narger Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narsa Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narbel Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narba Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narka Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narya Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narkoca Elektrik Enerjisi Üretim San. ve Tic. A.Ş. Member of the Board of Directors
Kurfalli Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narma Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narkan Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narbal Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Nartok Elektrik Enerjisi Üretim San. ve Tic. A.Ş.
Member of the Board of Directors
Narkara Elektrik Enerjisi Üretim San. ve Tic. A.Ş. Member of the Board of Directors
Tahsin Yazar
Afif Demirkıran
-
-
-
-
TC Ziraat Bankası
CEO & Member of the Board of
Directors
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
-
-
Yes
Hüseyin Aydın
Türkiye Bankalar Birliği Başkanlığı
Chairman of the Board of Directors Yes
Türkiye Varlık Fonu Yönetimi A.Ş.
Member of the Board of Directors
Yes
271
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272
Conclusion of the
Subsidiary Report
01.01.2020 - 31.12.2020 Fiscal Year
Conclusion of the Report on the relationship among the Parent Company and the subsidiaries as per Article 199 of the
Turkish Commercial Code:
Details of the legal transactions of our Company with Turkcell Holding A.Ş. and its subsidiaries during the fiscal year 2020
are given in the above tables. There is neither any legal transaction made in favor of Turkcell Holding A.Ş or one of its sub-
sidiaries nor any action taken or avoided in favor of Turkcell Holding A.Ş. or one of its subsidiaries upon directive by Turkcell
Holding A.Ş.
Details of services provided and/or fixed asset purchases/sales performed under operational activities carried out be-
tween our Company and Turkcell Holding A.Ş. and/or its subsidiaries that are fully in conformity with the market during the
fiscal year 2020 are included in this Report.
273
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274
Sectoral
and financial
information
276
Turkcell Group: 2020 financial & operational review
281
Forward looking statement
283
Our Companies and sector developments
288
Independent auditor’s report and consolidated financial statements
401
Our offices
402
Glossary
275
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
276
TURKCELL GROUP: 2020 FINANCIAL & OPERATIONAL REVIEW
Our audited annual consolidated financial statements including our consolidated statements of financial position as of
December 31, 2020 and 2019 and our consolidated statements of profit and loss, comprehensive income, changes in equi-
ty and cash flows for the two years in the period ended December 31, 2020 and the related notes included in this annual
report have been prepared in accordance with International Financial Reporting Standards as issued by the International
Accounting Standards Board (“IFRS Report”). The following financial and operational overview focuses principally on the
developments and trends in our business in the full year 2020 and should be read in conjunction with the IFRS report. The
figures are expressed in Turkish Liras (TRY) unless otherwise stated. A year on year comparison of key indicators is provided
and figures in parentheses following the operational and financial results for the year end 2020 refer to the same item for
the year end of 2019 unless otherwise stated. In the tables totals may not foot due to rounding differences. The same applies
to the calculations in the text.
TURKCELL GROUP: FINANCIAL SUMMARY
Profit & Loss Statement (million TRY)
Revenue
Cost of revenue1
Gross Margin1
Administrative expenses
Selling and marketing expenses
Net impairment loses on financial and contract assets
EBITDA2
EBITDA Margin
Depreciation and amortization
EBIT3
EBIT Margin
Net finance income / (costs)
Finance income4
Finance costs4
Other income / (expense)
Non-controlling interests
Share of profit of equity accounted investees
Income tax expense
Discontinued operations
Net Income
FY19
25,137.1
(12,036.9)
52.1%
(779.8)
(1,555.2)
(338.9)
10,426.4
41.5%
(5,046.6)
5,379.9
21.4%
(1,727.7)
297.5
(2,025.1)
(346.6)
(30.2)
(15.7)
(785.6)
772.4
3,246.5
FY20
29,103.7
(14,361.3)
50.7%
(749.6)
(1,373.0)
(349.6)
12,270.3
42.2%
(5,974.8)
6,295.5
21.6%
(1,131.7)
2,119.5
(3,251.2)
(523.3)
(2.5)
(13.8)
(387.2)
-
4,237.1
%Change
15.8%
19.3%
(1.4pp)
(3.9%)
(11.7%)
3.2%
17.7%
0.7pp
18.4%
17.0%
0.2pp
(34.5%)
612.4%
60.5%
51.0%
(91.7%)
(12.1%)
(50.7%)
-
30.5%
(1) Excluding depreciation and amortization expenses.
(2) EBITDA is a non-GAAP financial measure. See page 17 for the explanation of how we calculate Adjusted EBITDA and its reconciliation to net income.
(3) EBIT is a non-GAAP financial measure and is equal to EBITDA minus depreciation and amortization expenses.
(4) Fair value loss and interest expense regarding derivative instruments and the respective fair value gain and interest income regarding derivative instruments are represented on a net
basis. Starting from Q219, interest income on financial assets and interest expenses for financial liabilities, both measured at amortized cost, are represented on a net basis. Historical
periods were restated to reflect this change.
Consolidated Balance Sheet Data (Year End) (million TRY)
Cash and cash equivalents
Total assets
Long term debt
Total debt
Total liabilities
Total equity
2019
10,238.7
45,715.0
12,677.4
20,305.7
27,632.0
18,082.9
2020
11,860.6
51,498.4
16,353.7
21,586.4
30,713.5
20,784.9
Change%
15.8%
12.7%
29.0%
6.3%
11.2%
14.9%
Summary Consolidated Cash Flow Statement (million TRY)
Net cash inflow from operating activities
Net cash outflow from investing activities
Net cash (outflow)/inflow from financing activities
Effects of exchange rate changes on cash and cash equivalents
Cash and Cash Equivalents
Profitability and Solvency Ratios (%)
Gross Profit Margin1
EBITDA Margin
EBIT Margin
Net Profit Margin
Total Liability / Equity Ratio
Net Debt / EBITDA Multiple
(1) Excluding depreciation and amortization expenses.
EXPLANATIONS:
Revenue2: Turkcell Group revenues rose 15.8%.
Turkcell Turkey revenues grew 17.1% to TRY25,160 million
(TRY21,487 million).
· Consumer business increased 15.7% driven by strong
ARPU performance on the back of data and digital servic-
es usage, as well as residential business growth.
· Corporate revenues rose 23.5% supported by digital busi-
ness services revenue growth of 30.1%.
2019
9,026.6
(3,027.3)
(3,478.0)
298.2
10,238.7
2019
52.1%
41.5%
21.4%
12.9%
152.8%
1.0x
2020
13,092.8
(6,780.6)
(4,267.8)
(422.5)
11,860.6
2020
50.7%
42.2%
21.6%
14.6%
147.8%
0.8x
Change%
45.0%
124.0%
22.7%
(241.7%)
15.8%
Change%
(1.4pp)
0.7pp
0.2pp
1.7pp
(5.0pp)
(0.2x)
Administrative expenses: Administrative expenses fell to 2.6%
(3.1%) as a percentage of revenues, driven mainly by lower
office overhead costs and travel expenses.
Selling and marketing expenses: Selling and marketing ex-
penses declined to 4.7% (6.2%) as a percentage of revenues
driven by the decline in selling expenses (0.8pp), marketing
expenses (0.5pp) and other cost items (0.2pp) as a percent-
age of revenues.
Net impairment loses on financial and contract assets: Net
impairment losses on financial and contract assets was at
1.2% (1.3%) as a percentage of revenues.
· Wholesale revenues grew 12.3% to TRY1,293 million
(TRY1,152 million).
EBITDA4: EBITDA grew by 17.7% resulting in an EBITDA margin
of 42.2% (41.5%) on 0.7pp improvement.
Turkcell International revenues rose 26.9% to TRY2,542 million
(TRY2,003 million).
Other subsidiaries’3 revenues were at TRY1,401 million
(TRY1,647 million).
Excluding finance business and sports betting operations,
our consolidated revenue growth was 18.4% year-on-year
in FY20.
· Turkcell Turkey’s EBITDA rose 20.4% to TRY10,585 million
(TRY8,789 million) leading to an EBITDA margin of 42.1%
(40.9%) on 1.2pp improvement.
· Turkcell International EBITDA increased 29.4% to TRY1,169
million (TRY904 million) driving an EBITDA margin of 46.0%
(45.1%) on 0.9pp improvement.
· The EBITDA of other subsidiaries was at TRY516 million
(TRY733 million).
Standalone digital services revenues grew 25.6% year-on-
year in FY20.
Depreciation and amortization expenses: Depreciation and
amortization expenses increased 18.4% in FY20.
Cost of revenue (excluding the depreciation and amortiza-
tion): Cost of revenue (excluding depreciation and amorti-
zation) increased to 49.3% (47.9%) as a percentage of reve-
nues. This was due mainly to the rise in cost of goods sold
(2.3pp), despite the decline in cost of revenue of financial
services (0.5pp) and other cost items (0.4pp) as a percent-
age of revenues.
Net finance expense: Net finance expense decreased to
TRY1,132 million (TRY1,728 million). This was due mainly to
lower foreign exchange losses after hedging and higher in-
terest income on time deposits.
Discontinued operations: In accordance with our strategic
approach and IFRS requirements, Fintur was classified as
‘held for sale’ and reported as discontinued operations as
of October 2016.
(2) Please refer to the notes to the consolidated financial statements for the definition of Turkcell Turkey, Turkcell International and other subsidiaries.
(3) “Other subsidiaries” is mainly comprised of our information and entertainment services, call center business revenues, financial services revenues and inter-business eliminations.
(4) EBITDA is a non-GAAP financial measure.
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Sectoral and financial informationTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
278
On December 12, 2018, Turkcell signed a binding agreement,
and on April 2, 2019 completed the transfer of its shares
in Fintur to Sonera Holding B.V., the majority shareholder
of Fintur. The final value of the transaction was EUR352.9
million. As the conditions precedent required for the share
transfer were completed within Q119, TRY772 million profit
generated from the transaction was reflected in the Q119
financial statements.
Income tax expense: Income tax expense declined 50.7%
due mainly to lifecell’s deferred tax income. Please note that
in Q420 lifecell registered TRY689 million deferred tax in-
come having recognized its accumulated losses as deferred
tax assets.
Net income: Group net income increased 30.5% to TRY4,237
million (TRY3,246 million). Net income was positively impact-
ed by TRY689 million deferred tax income registered by li-
fecell. Excluding the deferred tax income impact and other
one-off expenses, we registered a net income of TRY3,953
million on a 39% rise on the back of strong operational per-
formance and prudent financial risk management. You can
see one-off expenses below:
One-off impacts (million TRY)
Sales of Fintur
Mobile tax settlement
Wireless tax (net of tax)
Compensation for Kcell SPA (Fintur)
Total
One-off impacts (million TRY)
lifecell deferred tax
Provision for litigation expenses
Litigation expenses
Other
Total
FY19
772
(199)
(116)
(60)
396
FY20
689
(243)
(146)
(15)
285
Total cash & debt: Consolidated cash as of December 31,
2020 decreased to TRY11,861 million from TRY13,524 million
as of September 30, 2020 due mainly to the dividend pay-
ment, and the impact of TRY appreciation on our FX de-
nominated cash. Excluding FX swap transactions, 74% of our
cash is in US$, 4% in EUR, and 22% in TRY.
Consolidated debt as of December 31, 2020 decreased to
TRY21,586 million from TRY22,841 million as of September 30,
2020 due mainly to the impact of TRY appreciation on FX
denominated debt. Please note that TRY2,099 million of our
consolidated debt is comprised of lease obligations.
Consolidated debt breakdown excluding lease obligations:
· Turkcell Turkey’s debt was at TRY17,469 million, of which
TRY10,197 million (US$1,389 million) was denominated in
US$, TRY5,624 million (EUR624 million) in EUR, TRY283 million
(CNY253 million) in CNY, and the remaining TRY1,364 million
in TRY.
· Finance company had a debt balance of TRY1,038 million,
of which TR259 million (US$36 million) was denominated in
US$, and TRY465 million (EUR52 million) in EUR with the re-
maining TRY314 million in TRY.
· The debt balance of lifecell was TRY980 million, fully de-
nominated in UAH.
TRY1,202 million of lease obligations is denominated in TRY,
TRY56 million (US$8 million) in US$, TRY186 million (EUR21 mil-
lion) in EUR, and the remaining balance in other local cur-
rencies (Please note that the figures in parentheses refer to
US$ or EUR equivalents).
Net debt as of December 31, 2020 was at TRY9,726 million
with a net debt to EBITDA ratio of 0.8 times. Excluding fi-
nance company consumer loans, our telco only net debt
was at TRY7,788 million with a leverage of 0.7 times.
Turkcell Group had a long FX position of US$132 million as
at the end of the year. (Please note that this figure takes
advance payments into account).
Capital expeditures: Capital expenditures including non-op-
erational items were at TRY9,079 million.
In 2020, operational capital expenditures (excluding license
fees) at the Group level was at 18.5% of total revenues.
Capital expenditures (million TRY)
Operational Capex
License and Related Costs
Non-operational Capex (Including IFRS15 & IFRS16)
Total Capex
Operational Review (Turkey):
Summary of Operational Data
Number of subscribers (million)
Mobile Postpaid (million)
Mobile M2M (million)
Mobile Prepaid (million)
Fiber (thousand)
ADSL (thousand)
Superbox (thousand)1
Cable(thousand)
IPTV (thousand)
Churn (%)2
Mobile Churn (%)3
Fixed Churn (%)
ARPU (Average Monthly Revenue per User) (TRY)
Mobile ARPU, blended
Mobile ARPU, blended (excluding M2M)
Postpaid
Postpaid (excluding M2M)
Prepaid
Fixed Residential ARPU, blended
Residential Fiber ARPU
Average mobile data usage per user (GB/user)
Mobile MoU (Avg. Monthly Minutes of usage per subs) blended
FY19
4,525.1
1.8
2,697.8
7,224.7
FY20
36.7
22.0
2.8
11.5
1,664.3
707.6
591.2
67.7
871.3
2.3%
1.9%
45.5
49.1
59.1
67.0
21.8
69.6
70.9
11.7
518.7
FY20
5,391.6
42.8
3,644.6
9,078.9
Change%
2.8%
7.8%
7.7%
(7.3%)
12.1%
(1.6%)
82.9%
37.6%
21.1%
(0.4pp)
(0.2pp)
14.3%
15.0%
4.6%
4.2%
19.1%
10.1%
9.2%
58.1%
24.9%
FY19
35.7
20.4
2.6
12.4
1,484.7
719.1
323.2
49.2
719.7
2.7%
2.1%
39.8
42.7
56.5
64.3
18.3
63.2
64.9
7.4
415.3
(1) Superbox subscribers are included in mobile subscribers.
(2) Presentation of churn figures has been changed to demonstrate average monthly churn figures for the respective quarters.
(3) In Q117, our churn policy was revised to extend from 9 months to 12 months (the period at the end of which we disconnect prepaid subscribers who have not topped up above TRY10).
Additionally, under our revised policy, prepaid customers who last topped up before March will be disconnected at the latest by year-end. As a regulatory requirement, we started to
disconnect prepaid lines in accordance with new ICTA regulation, which requires deactivation of prepaid lines which lack residency documents by the 6th month of subscription starting
from 2019. Furthermore, as required by the ICTA, the line of a deceased customer should either be transferred to a successor/another user or terminated. Lines, which are not transferred
or terminated, are to be disconnected at the end of seven months.
(4) We historically recorded all TV-related revenue under Turkcell Superonline and presented the related ARPU under fixed residential ARPU. As previously announced, our TV business
has become a separate standalone subsidiary. In order to reflect this change in our organization, we decided to shift mobile OTT TV ARPU from fixed residential ARPU into mobile ARPU
starting from Q320. We note that mobile TV revenues are generated by mobile subscribers. IPTV revenues will continue to be recorded under Turkcell Superonline and included under
residential fixed ARPU. In order to maintain comparability, we provide ARPU data for the last three years, revised to reflect this change on our investor relations website in financial and
operational data spreadsheet.
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Sectoral and financial informationTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
280
The number of our subscribers in Turkey grew by 1.1 million
net annual additions, reaching 36.7 million in FY20 despite
the pandemic environment. Accordingly, we achieved our 1
million net subscriber additions target for the year thanks to
our solutions that meet changing customer needs, our rich
value proposition, and innovative campaigns that facilitate
their lives.
The average monthly mobile churn rate was 2.3% in 2020.
The higher mobile churn rate in Q419 was due mainly to
the lump sum disconnection of subscriptions in accordance
with the ICTA regulation that requires deactivation of pre-
paid lines, that lack residency documents by the 6th month
of subscription. Average monthly fixed churn rate was at
1.9% in FY20.
On the mobile front, our subscriber base expanded to 33.4
million on 712 thousand net annual additions in FY20. Our
postpaid subscribers grew on 1.6 million net annual ad-
ditions, the highest of the past 11 years. Accordingly, our
postpaid subscribers reached 65.7% (62.2%) of our mobile
subscriber base as at the end of the year. Meanwhile, our
prepaid subscribers declined 892 thousand in FY20, due
mainly to the disconnection of 666 thousand inactive pre-
paid subscribers in Q420 in line with our churn policy. There
were also 194 thousand disconnections in Q420 to reflect
the regulatory change requiring deactivation of deceased
customers’ subscriptions.
On the fixed front, our subscriber base exceeded 2.4 million
on 187 thousand net annual additions. Our fiber subscribers
grew by 180 thousand annual net additions. Superbox, our
fixed-wireless access offering, registered a strong perfor-
mance in FY20. Accordingly, it had 268 thousand net annual
additions. Meanwhile, our IPTV customer base rose to 871
thousand on 152 thousand annual net additions.
Our mobile ARPU (excluding M2M) 15.0% for the full year on
the back of a larger postpaid subscriber base and upsell
efforts, as well as increased data and digital services usage.
Fiber residential ARPU grew by 9.2% for the full year driven
mainly by upsell efforts and the acquisition of higher reve-
nue generating customers.
Average monthly mobile data usage per user increased
58.1% for the full year. This was driven mainly by the increas-
ing number and data consumption of 4.5G users, as well as
higher digital services usage. Accordingly, the average mo-
bile data usage of 4.5G users reached 14.9 GB in Q420. The
rising number of Superbox subscribers also had a positive
impact on data consumption.
The number of 4.5G compatible smartphones on our net-
work rose to 21.5 million on 2.3 million annual additions,
comprising 91% of smartphones on our network. Total
smartphone penetration had reached 81% as at the end of
the year.
Forward Looking Statements
2021 guidance; revenue target of 14%-16%, EBITDA target of around TRY14
billion, and operational capex over sales ratio target of around 20%.
2 0 2 1 G u i d a n ce
14%-16%
Revenue
Growth
EBITDA
~TRY14
billion
~%20
Op. Capex/
Sales(1)
(1) Excluding license fee
Please note that this paragraph contains forward looking statements based on our current estimates and expectations regar-
ding market conditions for each of our different businesses. No assurance can be given that actual results will be consistent
with such estimates and expectations. For a discussion of factors that may affect our results, see our last Annual Report on
Form 20-F filed with the U.S. Securities and Exchange Commission, and in particular, the risk factor section therein.
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282
Our Companies and
sector developments
Electronic Communications
Sector in Turkey
According to the Market Data report
published by Information and Commu-
nication Technologies Authority (ICTA),
the regulatory authority of Turkish elec-
tronic communications sector, the num-
ber of companies in the sector is 458 as
of the 3rd quarter of 2020, and the num-
ber of authorizations granted to these
companies is 834.
In the first 3 quarters of 2020, the to-
tal net sales revenues of mobile oper-
ators [Turkcell İletişim Hizmetleri A.Ş.
(“Turkcell”), Vodafone Telekomünikasyon
A.Ş. (“Vodafone”), TT Mobil İletişim Hiz-
metleri A.Ş. (“TT Mobil”)] and Türk Tele-
komünikasyon A.Ş. (“Türk Telekom”) were
approximately TRY42.3 billion, while the
total net sales income of other opera-
tors was TRY14.1 billion. During the same
period, the total amount of investments
made by Turkcell, Türk Telekom, TT
Mobil and Vodafone was realized as
TRY8.4 billion.
Mobile Market
As of the 3rd quarter of 2020, there were
82.8 million mobile subscribers in Turkey,
corresponding to approximately 99.6%
penetration rate. (Mobile penetration
rate excluding M2M devices and 0-9
age population is 109%).
The number of 4.5G subscribers was
76.5 million, while the number of 3G
subscribers decreased to 4.4 million.
The number of mobile broadband sub-
scribers who receive 3G and 4.5G inter-
net services via computers and mobile
phones increased to 65 million.
As of the 3rd quarter of 2020, 64% of
mobile subscribers were in postpaid
tariffs, while 36% were in prepaid tar-
iffs. The number of prepaid mobile
broadband subscribers was 22.7 mil-
lion and the number of postpaid mobile
broadband subscribers was 42.3 million,
while the number of M2M subscribers
reached 6.1 million.
In the 3rd quarter of 2020, the number
of mobile numbers ported increased by
6.8% compared to the previous quarter
and realized as 3.3 million. As of No-
vember 24, 2020, total MNP transac-
tions reached 146 million.
Regarding the subscriber market shares;
Turkcell had 40.7%, Vodafone had 31.4%
and TT Mobil had 27.9% of the market.
Approximately 86.5% of mobile sub-
scribers were individual consumers and
13.5% were corporate subscribers.
Monthly average data usage in mobile
broadband was realized at the level of
9.3 GB, while the monthly average data
usage of subscribers with a device and
SIM card suitable for 4.5G service was
11 GB. In the 3rd quarter of 2020, the to-
tal mobile traffic volume increased by
12.3% compared to the same period of
last year and reached 78.9 billion min-
utes.
Turkcell’s revenue market share was
45.2% while Vodafone had 30.3% and
TT Mobil had 24.5% of the revenues in
the market.
The Broadband Internet Market
The number of broadband internet sub-
scribers, which was around six million
in 2008, reached 80.9 million (15.8 mil-
lion fixed broadband, 65 million mobile
broadband subscribers) as of the end
of the 3rd quarter of 2020. Total inter-
net subscribers increased 5% compared
to the same period of the previous
year. The number of xDSL subscribers
reached to 10.6 million, while the num-
ber of fiber subscribers exceeded 3.7
million. The total length of fiber infra-
structure of alternative operators had
reached 91,810 km.
In the first 3 quarters of 2020, the to-
tal revenues related to internet ser-
vice providers exceeded TRY8.6 billion.
The average monthly data usage of
fixed broadband internet subscribers
reached 153 GB. In Turkey, approximate-
ly 69% of fixed broadband subscribers
prefer packages with a connection of
10-35 Mbit/sec speed.
As of the 3rd quarter of 2020, the share
of xDSL services offered by alternative
operators in the broadband market is
26%.
TV Market
As of the 3rd quarter of 2020, there are
15 operators, which have the Cable
Broadcasting Service (KYH) authoriza-
tion. While the number of subscribers
of Türksat’s Cable TV is 1.33 million, the
operators providing IPTV services, Su-
peronline (TV+) and TTNet (Tivibu) have
811 thousand and 858 thousand sub-
scribers respectively.
The operators authorized to provide
satellite platform services are Digital
Platform Teknoloji Hizmetleri A.Ş. (Dig-
itürk), Demirören TV Digital Platform
İşletmeciliği A.Ş. (DSmart) and TTNET
A.Ş. (Tivibu) that continue broadcasting
actively.
Fixed Voice Market
As of the end of the 3rd quarter of 2020,
there are 12.3 million fixed telephone
subscribers, while the penetration rate
is approximately 14.8%.
Legal and Regulatory Developments
Concerning Our Industry and Our
Companies
Updates Regarding Mobile Reference
Interconnection Offers
With
the Board Decision dated
20.05.2020 and numbered 2020/DK-
ETD/151, the collateral items in the Refer-
ence Interconnection Offer of our Com-
pany has been updated to be valid as of
01.01.2021. The amount of the guarantee
letter to be given to our Company by
companies which interconnect with our
Company were increased, our Compa-
ny was given the authority to halt ser-
vice immediately if unpaid debts and
current usage of the SMS/MMS service
exceeded the guarantee letter, and in
case of a sudden traffic increase, com-
panies were obliged to make interim
payments in addition to providing addi-
tional collateral. It is predicted that the
updates made to collateral conditions
will be beneficial in reducing the collec-
tion risk experienced with companies
which interconnect with our Company.
Developments Regarding Mobile
Access and Call Origination Market
The deregulation decision regarding
the Mobile Access and Call Origina-
tion Market, transition process of which
was extended until 31.12.2019 with the
Board Decision dated 03.04.2019 and
numbered 2019/DK-SRD/097, entered
into force as of 01.01.2020. With the
decision, our Company is able to ne-
gotiate commercially for Mobile Virtual
Network Operator (MVNO) requests, as
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284
other two MNOs in Turkey. In the event
that the operators cannot compromise
and are requested, the authority of ICTA
to operate the settlement procedure
continues.
However, in the lawsuit filed for the
cancelation of the Board decision dat-
ed 18.02.2013 and numbered 2013/DK-
regarding acknowledgment
SRD/105
of the Final Document about Mobile
Networks Access and Call Origination
Market, which is declaring our Compa-
ny as the operator with Significant Mar-
ket Power (SMP) in the Mobile Networks
Access and Call Origination Market and
thereby imposing certain obligations
on our Company, the court found the
claims of our company justified, and
decided to cancel the transactions and
decisions subject to the lawsuit. Subse-
quently, the ICTA appealed aforemen-
tioned decision, the 13th Chamber of the
Council of State found the claims and
defenses of the ICTA unfair and decided
to approve the annulment decision. In
the subsequent process, the ICTA made
an application for a correction of the
decision regarding the approval deci-
sion, the 13th Department of the Council
of State decided to reject the ICTA’s de-
cision correction application, and in this
way, the said court decision became
final in favor of our Company.
Removal of Tariff Control Obligation
for SMS/MMS Termination Services
With the Mobile Call Termination Mar-
ket Analysis published by the Board De-
cision dated 08.09.2020 and numbered
2020/HR-SRD/258, it was decided to
remove the cost-based tariff determi-
nation obligation being applied for the
SMS/MMS termination services, as of
01.10.2021. Upon deregulation, the op-
erators will be able to negotiate and
determine SMS/MMS termination rates
among themselves. In addition, IP in-
terconnection has been included in the
obligation to provide access and inter-
connection imposed on operators.
Abolition of Asymmetry in Mobile
Termination Rates
Mobile termination rates have been
determined asymmetrically (at differ-
ent levels) since 2005 by the ICTA, in a
manner that is against our Company,
citing conditions such as mobile market
conditions, traffic distribution, revenues,
number of subscribers and technolog-
ical differences. In the lawsuit filed by
our Company for cancellation of the
rejection of the application filed to
the ICTA on 13.11.2017 with the request
to abolish the inequality (asymmetry)
in mobile termination rates, the court
decided to accept the case by find-
ing the claims of our company justified
with its decision dated 18.07.2019; ICTA
appealed the case before Regional Ad-
ministrative Court. Regional Administra-
tive Court, which examined the request
of appeal, sent the file to the Council of
State for a new decision on the grounds
that the case should be heard at the
Council of State. While the case is cur-
rently pending in the Council of State
examination, a comprehensive study on
interconnection fee levels is being con-
ducted by the ICTA.
On the other hand, the fact that there
was no difference between the oper-
ators that could justify the asymmetry
was determined by the decision of 13th
Chamber of the Council of State dated
05.03.2015 and numbered E.2014/1750,
K.2015/895.
Maximum Tariff Regulation on Mobile
Electronic Communication Services
Maximum tariffs of the services (na-
tional/international voice and SMS,
name/title change, line transfer, num-
ber change, SIM card change, line on/
off, detailed invoice, unknown numbers
service etc.) included in the Maximum
Tariff Regulation of Mobile Electronic
Communication Services are updated
every six months by ICTA. Tariff were in-
creased by 5.8% on 01.04.2020 and by
5.3% on 01.10.2020.
Developments in the Wholesale Fixed
Local and Central Access Markets
the Board Decision dat-
With
17.01.2020 and numbered 2019/
ed
DK-SRD/338, the Final Document on
Wholesale Fixed Local and Central Ac-
cess Markets Analysis was published.
Together with this market analysis, the
incumbent operator (Türk Telekom) was
designated as having Significant Mar-
ket Power in related fixed broadband
markets and obliged to offer cost-
based IP-level Data Stream Access (IP
Bitstream) and Ethernet Bitstream Ac-
cess over its copper and fiber networks,
to provide Virtual Unbundled Local Ac-
cess (VULA) service. Besides, the margin
squeeze obligation has been imposed
on the incumbent operator.
In this context, Türk Telekom’s Draft
Reference Offers (IP Bitstream Offer,
Buy-Sell Wholesale Offer, Ethernet Bit-
stream Offer, Facility Sharing and Dark
Fiber Offer, SSG/ME
Internet Offer,
Co-Location and Building Access Offer)
which determine the conditions of the
access obligations and the Draft Proce-
dures and Principles for the Detection,
Prevention and Elimination of Margin
Squeeze have been submitted to the
public opinion in 2020. Efforts to final-
ize the relevant documents are ongoing
before BTK.
Regulation on Processing of Personal
Data and Protection of Privacy in the
Electronic Communications Sector
The “Regulation on the Processing of
Personal Data and the Protection of
Privacy in the Electronic Communica-
tion Sector” published in the Official
Gazette on 04.12.2020 will enter into
force on 04.06.2021, six months after
its publication. The Regulation regu-
lates the principles and procedures to
be followed by operators operating in
the electronic communications sector in
terms of the data they obtain within the
scope of providing electronic communi-
cations services, including legal person
subscriptions. Detailed arrangements
have been made in the Regulation on
issues such as explicit consent process-
es within the scope of processing the
data of subscribers and users, data
security, reporting of risk and violation,
number hiding, and automatic call for-
warding.
Presidential Circular on Information
and Communication Security
Measures
Pursuant to the Presidency Circular on
Information and Communication Se-
curity Measures, published in the Of-
ficial Gazette numbered 30823 and
dated 06.07.2019, the “Information and
Communication Security Guide”, was
announced by the Presidential Digital
Transformation Office on 27.07.2020,
which sets out the information and
communication security measures to
be followed and related activities to
be carried out by public institutions as
well as the enterprises providing critical
infrastructure services to ensure the se-
curity of critical data and information.
The Guide aims to encourage the use
of domestic products within the frame-
work of measures to be taken by public
institutions and concerned enterprises,
and to prevent repetitive studies and
investments.
ICTA Board Decisions Regarding the
COVID Period
With the ICTA decision dated 31.03.2020
and numbered 2020/DK-THD/100; until
the measures introduced by Presiden-
tial Circulars regarding the epidemic
are lifted, operators have been given
the opportunity to carry out call center
services remotely without interruption,
to send invoices electronically and to
establish subscriptions remotely by re-
ceiving the information/documents re-
quired for new subscriptions first elec-
tronically and then by mail/cargo.
With the decision of the ICTA dat-
ed 31.03.2020 and numbered 2020/İK
YED/099; it has been made possible
to postpone by up to 3 (three) months
the sending periods of information and
documents prepared within the scope
of the regular reports that we are
obliged to submit to the authority.
Establishment of Electronic
Communication Subscription
Contracts in the Electronic
Environment
Amendments to the Electronic Commu-
nications Law numbered 5809 made by
the “Law on the Amendment of Certain
Laws and Statutory Decrees” numbered
7247, which entered into force upon
being published in the Official Gazette
dated 26.06.2020 and numbered 31167,
have regulated that the procedures and
principles regarding the verification of
the applicant’s identity for the contracts
to be established in an electronic me-
dium will be determined by ICTA. The
relevant procedures and principles have
not yet been published.
Commercial Communication and
Commercial Electronic Messages
With the Regulation on the Amendment
of the Regulation on Commercial Com-
munication and Commercial Electronic
Messages published in the Official Ga-
zette dated 28.08.2020 and numbered
31227, a new system [Commercial Elec-
tronic Message Management System
(“CMMS”)] that allows the registration
and management of consents giv-
en or refused for receipt of electronic
including the
commercial messages
management of the consents and the
complaints, has been introduced. The
system obliges service providers who
wish to send electronic commercial
messages, to register with the CMMS
and to transfer their existing consent
data base. It has also been regulated
that it is not permitted to send elec-
tronic commercial messages to recip-
ients who have not officially consent-
ed the relevant service provider on the
CMMS. Therefore, the service providers
are expected to verify the consent giv-
en by the recipient before initiating the
circulation of the electronic commercial
messages.
Social Network Provider
Regulations
With the amendments made within
the scope of Law No. 5651 on Regulat-
ing Broadcasts via Internet and Fight-
ing Crimes Committed Through Such
Broadcasts, effective from 01.10.2020;
new obligations have been introduced
to overseas social network providers
with daily access from Turkey exceed-
ing 1 million, including appointing at
least one person to be their representa-
tive in Turkey, and hosting the data from
users in Turkey. It has been regulated
that if regulations are not complied
with, sanctions such as administrative
fines, an advertising ban and band-
width reduction may be imposed. After
the amendments made to the Law No.
5651, The Procedures and Principles on
the Social Network Provider were pre-
pared by the ICTA and published in the
Official Gazette dated 02.10.2020 and
have entered into force. Regulation on
Sales of Renewed Products
The Regulation on the
Sale of Renewed Products
Products on the renewal of used mobile
phones and tablets, warranty conditions
of renewed devices, authorization of
renewal centers, and regulation of the
obligations of market actors entered
into force on 22.08.2020. The stand-
ard published by the TSE on 17.02.2021
for renewal centers, which will sell
renewed and certified used mobile
phones, the purchase of second-hand
mobile phones and tablets has been
made more reliable for consumers, and
second-hand devices were enabled to
be introduced to the ecosystem.
Amendment of Concession
Agreements and Authorization
Certificate within the Law No. 7061
on Amending Certain Tax Laws and
Certain Other Laws
With the Law No. 7061, it has been pos-
sible to structure disputes regarding
certain financial obligations. In addi-
tion, with the Law, changes have been
made in the tax laws and other laws
concerning the sector in order to elim-
inate the problems experienced in the
calculation, collection and follow-up of
taxes and other financial obligations
taken from the electronic communi-
cations sector. It has been enacted in
the Law that the operators applying for
restructuring will be deemed to have
applied to the ICTA for the amendment
of the Concession Agreements and Au-
thorization Certificate within the scope
of these changes. The texts prepared by
our Company and the ICTA regarding
the amendments, were included in the
Concession Agreements and Author-
ization Certificate upon the approval
of the Council of State, and the sig-
nature processes were completed on
16.01.2020.
Cancellation of TRY138 Million
Administrative Fine Imposed by the
Ministry of Trade
As a result of the investigation conduct-
ed by the Ministry of Commerce for 2015,
an administrative fine of TRY138 million
was imposed on our Company due to
alleged violations of distance contracts,
subscriber agreements, agreement of
sales on installment. A lawsuit was filed
for the cancellation of the mentioned
transactions and decisions by our com-
pany. The court found the claims of our
Company to be justified and accepted
the case and cancelled the adminis-
trative fine. The defendant administra-
tion appealed the decision following
the rejection of defendant administra-
tion’s appeal by Regional Administrative
Court. The appeal process is pending.
Administrative Fine Imposed by the
Competition Board
The Competition Board imposed an ad-
ministrative fine of TRY92 million claim-
ing that our Company had violated
competition by determining the resale
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286
price of units. Legal actions have been
taken to withdrawal the aforemen-
tioned administrative fine by our com-
pany.
The Competition Board accepted some
of the objections of our Company and
changed its previous decision; it abol-
ished the fine of TRY92 million and de-
cided the administrative fine of TRY61
million for our Company with its new
decision. The administrative fine was
paid with twenty five percent discount
on 09.04.2020, in the amount of TRY45
million. Then, a lawsuit was filed for the
stay of the execution and cancellation
of the aforementioned administrative
fine. The case is pending.
Lawsuits Regarding the
Use of 444 Numbers
In three separate lawsuits filed by our
Company with the request for the stay
of execution and the cancellation of the
ICTA’s transactions that restrict/prevent
the use of the 444 numbers, it was de-
cided to cancel the ICTA transactions
on the ground that it was illegal, and
the cancellation decisions were fi-
nalized. Due to the decision to cancel
the aforementioned ICTA transactions,
an application has been made to the
ICTA by our Company to execute the
requirements of the court decisions
and to eliminate the illegality in prac-
tice. Upon the implicit rejection of this
application, another lawsuit was filed,
and the court accepted this case in fa-
vor of our Company. After the defend-
ant administration’s appeal and the Re-
gional Administrative Court rejection of
the defendant administration’s appeal,
the ICTA appealed the aforementioned
decision, and the appeal is pending. In
the meantime, the ICTA conducts evalu-
ations and legislation studies regarding
this dispute.
Cancellation of Board Decision
Increasing the ICTA’s Obligation for 3G
Coverage
In the lawsuit filed with the request
for stay of execution and cancella-
tion of the decision of the ICTA dated
21.07.2014 and numbered 2014/DK-
YED/376, which changed the scope of
the obligations subject to the Conces-
sion Agreement of Turkcell grounding on
the amendment made in Laws No 6360
and 6447 and Metropolitan Municipali-
ty Law No.5216 and the transaction of
the notification of this decision dated
14.08.2014 and numbered 151.99/50991,
the Court has justified the claims of our
Company with its decision notified on
17.04.2019 and decided to cancel the
Board decision and the act. The de-
fendant appealed the decision and the
appeal is pending.
Amendment of the Regulation
on Establishment and Operation
Principles of Financial Leasing,
Factoring and Financing Companies
“The maturity of loans used for the
purchase of computers cannot exceed
twelve months, the maturity of loans
used for the purchase of tablets can-
not exceed six months, the maturity of
loans used for the purchase of mobile
phones of up to three thousand five
hundred Turkish Liras cannot exceed
twelve months and the maturity of
loans used for the purchase of mobile
phones priced over three thousand five
hundred Turkish Liras cannot exceed
three months. The same terms shall ap-
ply for the restructuring of these loans.”
provision has been introduced in ac-
cordance with the Regulation Amend-
ing the Regulation on Establishment
and Operation Principles of Financial
Leasing, Factoring and Financing Com-
panies published in the Official Gazette
on 14.01.2020. The Presidency Strategy
and Budget Directorate is authorized to
change the limitations in this article or
to impose additional restrictions in this
regard, considering the opinion of the
T.R. Ministry of Treasury and Finance.
Amendment of the Regulation on the
Principles and Rules to be implied in
Retail Trade
The Regulation Amending the Regula-
tion on the Principles and Rules to be
Implied in Retail Trade was published in
the Official Gazette dated 26.12.2020.
Accordingly, the installment periods are
determined as follows:
• three months for mobile phone sales
with a price of over three thousand five
hundred Turkish Liras,
• four months for sales of electron-
ic goods such as video, camera and
sound systems, and sales of televisions
priced over three thousand five hundred
Turkish Liras, six months for tablet com-
puter sales,
• eighteen months for domestic ex-
penses related to airlines, travel agen-
cies and accommodation.
Cancellation Decision Given for TÖHAŞ
Payment Order Case
The mobile payment services of TÖHAŞ
between 01.07.2015-15.08.2018 were
audited by the BRSA; subsequently, an
administrative fine imposed on TÖHAŞ;
in the amount of TRY18,762,982; a law-
suit has been filed by TÖHAŞ with the
request for the stay of execution and
cancellation of the aforementioned de-
cisions and transactions. The hearing
was held on 30.12.2020 in this case and
it is expected that the court will grant
a decision.
While this case was ongoing, the Tax
Office sent a payment order for the col-
lection of the aforementioned adminis-
trative fine; a lawsuit was filed with the
request for the stay of execution and
the cancellation of the payment order.
In the lawsuit filed, the court decided
to accept the case and cancelled the
payment order subject to the case.
Therefore, in the current situation, until
the lawsuit filed for the cancellation of
the administrative fine is concluded,
the collection procedures should not be
continued.
Limitation on Dividend Distributions
With the Provisional Article 13 intro-
duced to the Turkish Commercial Code
No. 6102 dated 13.01.2011 by “the Law on
Reducing the Effects of the Novel Coro-
navirus Pandemic on Economic and
Social Life and Law on Amendments to
Certain Laws”, which was published in
the Official Gazette dated 17.04.2020
and entered into force as of the same
date, it has been regulated that compa-
nies are allowed to decide to distribute
up to twenty-five percent of their net
profit for the year 2019 until 30.09.2020.
The President is authorized to extend
and shorten the specified period for
three months, and with the Presiden-
tial Decision No. 2948 published in the
Official Gazette dated 18.09.2020 and
numbered 31248, the aforementioned
period was extended until 31.12.2020.
platform an independent quality, it was
decided to transfer the BiP platform to
BiP İletişim Teknolojileri ve Dijital Servis-
ler A.Ş., one of our Company’s subsidi-
aries, at a price to be determined in the
valuation report to be prepared by the
independent audit firm, with the de-
cision of the Board of Directors dated
24.09.2020. This transfer process was
completed on 31.12.2020.
In order to achieve Turkcell’s vision of
expanding its digital services and tech-
nology solutions in international mar-
kets, and to increase international pen-
etration, on 07.09.2020 “Lifecell Digital
Communication Technologies B.V.” was
incorporated in The Netherlands with
a capital of EUR50,000 and registered
with the trade registry, as a compa-
ny fully owned by Lifecell Ventures
Coöperatief U.A., one of our subsidiar-
ies. It stores the data regarding sales of
digital services and products, which are
developed with the resources of Turk-
cell, in Turkey. On 04.12.2020, its trade
name has been changed to “BiP Digital
Communication Technologies B.V.” and
this change has been duly registered.
Entry into Force of the
Digital Service Tax
The Law numbered 7194 on Digital Ser-
vice Tax and Amendment of Certain
Laws and the Decree numbered 375
has entered into force on 01.03.2020;
and the Communiqué on Application of
Digital Service Tax was published in the
Official Gazette dated 20.03.2020. The
revenues obtained from the below-list-
ed activities in Turkey are subject to
digital service tax at the rate of 7.5% as
set out by the Law.
• All kinds of advertising services of-
fered in the digital environment,
• Services offered in digital environ-
ment for the sale of any audio, visual or
digital content and for listening, view-
ing, playing, recording or using these
contents in digital environment,
• Services regarding providing and op-
erating digital environments where us-
ers can interact with each other,
• Intermediary services provided in dig-
ital environment by digital service pro-
viders for the aforementioned services
as well as advertisements published on
the websites of newspapers or maga-
zines, or on the websites of audio and/
or visual publishing companies, which
are active only in digital environment,
or during broadcast flows thereof.
If the taxpayer is a member of a con-
solidated group in terms of financial
accounting, the group’s total generated
revenue regarding the services subject
to the tax shall be taken into account
when applying these limits.
Seizure of UYAP Asset Inquiries in the
Electronic Environment
The Law on the Amendment of the Civil
Procedure Law No. 7251 and Some Laws
entered into force after being published
in the Official Gazette No. 31199 dated
28.07.2020. With the change; in the en-
forcement proceedings, it is stipulated
that the goods, rights or receivables of
the debtor can be questioned through
UYAP, and that the debtor’s goods, re-
ceivable or receivables can be de-
manded directly through UYAP. As a
result of the query made through the
electronic system, it has been stated
that the debtor’s rights and / or prop-
erty can be seized electronically by
the enforcement offices based on the
request of the creditor who requests
lien on the rights and/or property of the
debtor, and the regulation containing
the detailed regulation on this issue will
be published.
The Recently Established Lifecell Cloud
(Lifebox), Lifecell Music (fizy) and
Lifecell TV (TV+ ott) Companies
Turkcell İletişim Hizmetleri A.Ş. within the
scope of the decision of the Board of
Directors dated 30.06.2020, transferred
its fizy service to Lifecell Müzik ve Yayın
İletim A.Ş., its lifebox service to Lifecell
Bulut Çözümleri A.Ş., and Superonline
İletişim Hizmetleri A.Ş. managed OTT
activities of TV+ service to Lifecell TV
Yayın ve Content Hizmetleri A.Ş.
Lifecell Music (fizy) & Lifecell TV
(TV+ ott) License and Authorization
Applications with RTÜK
With the Regulation on the Presentation
of Radio, Television and Broadcasts on
the Internet, which was published on
01.08.2019, radio, television and broad-
casts on the internet and the transmis-
sion of these broadcasts on the internet
are subject to license and authorization.
In this context; (i) Lifecell Müzik Yayın
ve İletim A.Ş. has applied for “Internet
– IBYH Licence” for the “fizy” platform
broadcasting on demand from the in-
ternet, (ii) for the TV+ (OTT) platform
that transmits broadcasts from the in-
ternet - mobile environment, Lifecell TV
Broadcasting and Content Services A.Ş.
made the application for “Broadcast-
ing Authorization on the Internet” to the
Radio and Television Supreme Council
(“Supreme Council”) on 01.07.2020, and
the decision of the Supreme Council on
the applications is pending.
Transfer of BiP Platform and
Establishment of BiP B.V.
With the decision of the Turkcell Board
of Directors dated 29.04.2020, it was
decided that the BiP platform owned by
Lifecell Ventures Coöperatief U.A., one
of our subsidiaries, to be transferred to
our Company Turkcell İletişim Hizmetleri
A.Ş. at a price to be determined in the
valuation report to be prepared by the
independent audit firm, by transferring
the intangible rights constituting the
platform. Accordingly, the transfer pro-
cess was completed on 30.06.2020.
Subsequently, in order to give the BiP
287
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Sectoral and financial informationTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
288
Independent auditor’s
report and consolidated
financial statements
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
AND INDEPENDENT AUDITOR’S REPORT
This report is 106 pages.
289
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Group companies and other informationon corporate governanceTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
294
TURKCELL ILETISIM HIZMETLERI AS
F1
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Note
31 December 2020
31 December 2019
Assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Investment properties
Trade receivables
Receivables from financial services
Contract assets
Deferred tax assets
Investments in equity accounted investees
Other non-current assets
Total non-current assets
Inventories
Trade receivables
Due from related parties
Receivables from financial services
Contract assets
Derivative financial instruments
Financial assets at amortized cost
Financial assets at fair value through other comprehensive income
Cash and cash equivalents
Other current assets
Total current assets
Total assets
Equity
Share capital
Share premium
Treasury shares
Additional paid-in capital
Reserves
Remeasurements of employee termination benefit
Retained earnings
Total equity attributable to equity holders of
Turkcell Iletisim Hizmetleri AS (“the Company”)
Non-controlling interests
Total equity
11
15
12
14
19
20
21
18
17
22
19
20
21
35
25
24
23
26
26
13,902,730
2,380,174
12,367,784
13,675
222,451
75,717
128,114
836,608
103,926
883,842
30,915,021
203,715
3,465,797
16,476
1,886,381
972,052
917,437
172,363
529,610
11,860,555
558,986
20,583,372
12,458,491
1,783,096
11,308,062
16,283
148,159
123,136
10,291
189,342
41,701
304,270
26,382,831
178,399
3,133,975
4,477
2,319,122
933,969
845,513
5,368
345,602
10,238,715
1,327,004
19,332,144
51,498,393
45,714,975
2,200,000
269
(147,914)
35,026
2,400,000
(94,684)
16,392,070
2,200,000
269
(144,152)
35,026
2,816,359
(63,539)
13,202,526
20,784,767
18,046,489
171
20,784,938
36,455
18,082,944
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
1
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296
F2
TURKCELL ILETISIM HIZMETLERI AS
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
TURKCELL ILETISIM HIZMETLERI AS
F3
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
For the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Liabilities
Borrowings
Employee benefit obligations
Provisions
Deferred tax liabilities
Contract liabilities
Other non-current liabilities
Total non-current liabilities
Borrowings
Current tax liabilities
Trade and other payables
Due to related parties
Deferred revenue
Provisions
Contract liabilities
Derivative financial instruments
Total current liabilities
Total liabilities
Total equity and liabilities
Note
31 December 2020
31 December 2019
Note
2020
2019
2018
29
30
33
18
32
28
29
34
31
33
32
35
16,353,685
381,923
411,931
1,337,831
164,764
498,059
19,148,193
5,232,737
134,175
4,976,605
40,355
116,921
630,288
315,070
119,111
11,565,262
12,677,394
294,331
337,404
1,165,630
141,890
359,857
14,976,506
7,628,333
121,258
4,117,471
12,082
56,544
342,812
290,408
86,617
12,655,525
30,713,455
27,632,031
51,498,393
45,714,975
Revenue
Revenue from financial services
Total revenue
Cost of revenue
Cost of revenue from financial services
Total cost of revenue
Gross profit
Gross profit from financial services
Total gross profit
Other income
Selling and marketing expenses
Administrative expenses
Net impairment losses on financial and contract
assets
Other expenses
Operating profit
Finance income
Finance costs
Net finance costs
Share of loss of equity accounted investees
Profit before income tax
Income tax expense
Profit from continuing operations
Gain from discontinued operations
(attributable to owners of the Company)
5
5
10
10
6
10
10
10
6
8
8
9
28,272,751
830,987
29,103,738
23,996,262
1,140,873
25,137,135
20,173,354
1,119,121
21,292,475
(20,161,096)
(174,963)
(20,336,059)
(16,816,705)
(266,775)
(17,083,480)
(13,751,195)
(394,798)
(14,145,993)
8,111,655
656,024
8,767,679
7,179,557
874,098
8,053,655
96,585
(1,372,953)
(749,612)
140,705
(1,555,189)
(779,755)
(349,595)
(619,835)
5,772,269
(338,857)
(487,295)
5,033,264
2,119,483
(3,251,164)
(1,131,681)
297,450
(2,025,118)
(1,727,668)
(13,775)
4,626,813
(387,193)
4,239,620
(15,712)
3,289,884
(785,630)
2,504,254
6,422,159
724,323
7,146,482
241,435
(1,626,714)
(673,370)
(346,390)
(381,582)
4,359,861
1,677,114
(3,364,072)
(1,686,958)
(87)
2,672,816
(495,481)
2,177,335
-
772,436
-
Profit for the year
4,239,620
3,276,690
2,177,335
Profit for the year is attributable to:
Owners of the Company
Non-controlling interests
Total
Basic and diluted earnings per share for profit attributable
to owners of the Company (in full TL)
Basic and diluted earnings per share for profit from
continuing operations attributable to owners of the
Company (in full TL)
Basic and diluted earnings per share for profit from
discontinued operations attributable to owners of the
Company (in full TL)
27
27
27
4,237,086
2,534
4,239,620
3,246,487
30,203
3,276,690
2,021,065
156,270
2,177,335
1.94
1.94
-
1.49
1.14
0.35
0.93
0.93
-
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
2
The above consolidated statement of profit or loss should be read in conjunction with the accompanying notes.
3
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F4
TURKCELL ILETISIM HIZMETLERI AS
CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
For the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Profit for the year
Other comprehensive income/(expense):
Note
2020
2019
2018
4,239,620 3,276,690
2,177,335
Items that will not be reclassified to profit or loss:
Remeasurements of employee termination benefits
Income tax relating to remeasurements of employee termination benefits
30
Items that may be reclassified to profit or loss:
Exchange differences on translation of foreign operations
Exchange differences arising from discontinued operations
Fair value reserve
Cash flow hedges - effective portion of changes in fair value
Cash flow hedges - reclassified to profit or loss
Cost of hedging reserve - changes in fair value
Cost of hedging reserve - reclassified to profit or loss
Loss on hedges of net investments in foreign operations
Income tax relating to these items
-Income tax relating to exchange differences
-Income tax relating to fair value reserve
-Income tax relating to hedges of net investments
-Income tax relating to cost of hedging reserve
-Income tax relating to cash flow hedges
35
9
35
Other comprehensive income/(loss) for the year, net of income tax
Total comprehensive income for the year
Total comprehensive income for the year is attributable to:
Owners of the Company
Non-controlling interests
Total
Total comprehensive income for the year attributable to owners of
the Company arises from:
Continuing operations
Discontinued operations
Total
(37,230)
6,085
(31,145)
(36,385)
8,005
(28,380)
12,699
(2,794)
9,905
431,810
29,352
104,986
-
4,451
(1,970)
221,488
1,523,123
(439,365)
(1,513,209)
97,373
(589,856)
(21,768)
102,212
(55,389)
(368,959)
(56,728)
167,028
(99,234)
7,729
(979)
483
12,186
72,684
(16,634)
92,089
47,933
(5,957)
286,858
(652,279)
258,478
(683,424)
3,556,196 3,535,168
424,817
425,371
-
630,191
(611,035)
(390,267)
42,665
-
(154,409)
(226,667)
-
-
76,472
(4,214)
367,333
377,238
2,554,573
3,553,662 3,505,496
29,672
2,534
2,398,930
155,643
3,556,196 3,535,168
2,554,573
3,553,662 2,628,074
877,422
3,553,662 3,505,496
-
1,957,396
441,534
2,398,930
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
4
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
300
F6 TURKCELL ILETISIM HIZMETLERI AS
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Note
2020
2019
2018
Cash flows from operating activities:
Profit for the year from
Continuing operations
Discontinued operations
Profit for the year including discontinued operations
Adjustments for:
Depreciation and impairment of property, plant and equipment and investment properties
Amortization of intangible assets and right of use assets
Net finance expense
Fair value adjustments to derivatives
Income tax expense
(Gain) on sale of property, plant and equipment
Unrealized foreign exchange losses on operating assets
Provisions
Share of equity accounted investees
Loss/(gain) on sale of subsidiary
Adjustments to (earnings) due to disposal of assets held for sale
Non-cash other adjustments
Change in operating assets/liabilities
Change in trade receivables
Change in due from related parties
Change in receivables from financial services
Change in inventories
Change in other current assets
Change in other non-current assets
Change in due to related parties
Change in trade and other payables
Change in other non-current liabilities
Change in employee benefit obligations
Change in short term contract asset
Change in long term contract asset
Change in deferred revenue
Change in short term contract liability
Change in long term contract liability
Changes in other working capital
Cash generated from operations
Interest paid
Income tax paid
Net cash inflow from operating activities
Cash flows from investing activities:
Acquisition of property, plant and equipment
Acquisition of intangible assets
Proceeds from sale of property, plant and equipment
(Payments for)/proceeds from advances given for acquisition of property, plant and equipment
Contribution of increase of share capital in joint ventures/associates
Proceeds from sale of subsidiary
Cash inflows from financial asset at fair value through other comprehensive income
Cash outflows from financial asset at fair value through other comprehensive income
Payments for financial assets at amortized cost
Interest received
Net cash outflow from investing activities
Cash flows from financing activities:
Dividends received for treasury share
Proceeds from derivative instruments
Repayments of derivative instruments
Proceeds from issues of loans and borrowings
Proceeds from issues of bonds
Repayment of borrowings
Repayment of bonds
Dividends paid to shareholders
Dividends paid to non-controlling interest in subsidiaries
Acquisition of treasury shares
Payments of lease liabilities
Other cash (outflows)/inflows from financing activities
Net cash outflow from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at 1 January
11-14
12-15
9
19
39
20
22
23
17
39
34
28
30
21
21
32
32
11
12
4,239,620
-
4,239,620
2,426,263
3,548,516
901,530
(2,016,859)
387,193
(23,950)
4,384,197
1,230,295
13,775
1,387
-
(13,840)
15,078,127
(618,545)
(11,208)
429,950
(25,316)
547,475
(71,752)
27,484
614,418
739
(20,850)
(38,636)
(117,823)
82,254
24,662
22,874
(543,289)
15,380,564
(1,653,675)
(634,094)
13,092,795
(3,904,443)
(3,375,915)
99,843
(501,339)
(76,000)
1,229
976,576
(972,188)
(23,298)
994,899
(6,780,636)
6,232
2,085,585
(866,650)
22,983,201
494,987
(26,354,532)
(455,878)
(811,622)
(32,856)
(9,994)
(1,302,335)
(3,951)
(4,267,813)
2,504,254
772,436
3,276,690
2,199,830
2,846,735
1,442,773
(570,204)
785,630
(47,169)
1,832,636
920,924
15,712
-
(772,436)
(15,557)
11,915,564
(881,333)
10,025
1,651,180
2,035
(299,790)
(38,112)
(33,135)
92,427
(8,122)
(36,231)
(223,146)
(6,778)
45,402
34,652
10,292
(506,303)
11,728,627
2,177,335
-
2,177,335
1,894,445
2,393,529
983,881
(1,719,610)
495,481
(43,727)
2,954,304
796,520
87
(110,308)
-
-
9,821,937
273,110
(5,870)
(69,991)
(76,883)
53,957
142,133
40,072
(501,980)
(242,384)
(32,764)
(711,928)
(3,513)
54,391
255,756
131,598
(981,764)
8,145,877
(2,090,718)
(611,354)
9,026,555
(1,658,308)
(657,715)
5,829,854
(3,195,069)
(2,821,111)
81,192
156,936
(38,000)
2,219,644
84,655
(369,591)
-
854,018
(3,027,326)
7,380
1,924,363
(1,101,876)
29,060,490
311,649
(31,297,901)
(225,794)
(1,010,000)
(125,027)
(9,998)
(1,215,320)
204,077
(3,477,957)
(2,960,648)
(2,264,912)
103,864
(204,817)
(19,500)
118,528
-
(39,877)
-
731,793
(4,535,569)
9,399
1,054,345
(710,522)
44,341,070
2,188,313
(43,987,127)
(191,312)
(1,900,000)
(58,778)
(94,620)
(1,164,879)
(20,272)
(534,383)
2,044,346
2,521,272
759,902
10,238,715
7,419,239
4,712,333
Effects of exchange rate changes on cash and cash equivalents
(422,506)
298,204
1,947,004
Cash and cash equivalents at 31 December
24
11,860,555
10,238,715
7,419,239
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Notes to the consolidated financial statements
1. Reporting entity
2. Basis of preparation and summary of significant accounting policies
3. Financial risk management
4. Segment information
5. Revenue
6. Other income and expenses
7. Employee benefit expenses
8. Finance income and costs
9. Income tax expense
10. Expenses by nature
11. Property, plant and equipment
12. Intangible assets
13. Impairment of assets
14. Investment property
15. Right of use assets
16. Discontinued operation
17. Other non-current assets
18. Deferred tax assets and liabilities
19. Trade receivables and accrued revenue
20. Receivables from financial services
21. Contract assets
22. Inventory
23. Other current assets
24. Cash and cash equivalents
25. Financial assets
26. Equity
27. Earnings per share
28. Other non-current liabilities
29. Loans and borrowings
30. Employee benefits
31. Deferred revenue
32. Contract liabilities
33. Provisions
34. Trade and other payables
35. Derivative financial instruments
36. Financial instruments
37. Guarantees and purchase obligations
38. Commitments and contingencies
39. Related parties
40. Subsidiaries
41. Cash flow information
42. Subsequent events
Page
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63
63
64
66
67
68
68
71
72
72
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74
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86
97
97
100
104
106
106
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
6
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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F8
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F9
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Reporting entity
1.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Reporting entity (continued)
1.
Turkcell Iletisim Hizmetleri Anonim Sirketi (the “Company” or “Turkcell”) was incorporated in Turkey on
5 October 1993 and commenced its operations in 1994. The address of the Company’s registered office is
Maltepe Aydinevler Mahallesi Inonu Caddesi No: 20, Kucukyali Ofispark/Istanbul. It is engaged in
establishing and operating a Global System for Mobile Communications (“GSM”) network in Turkey and
regional states.
In April 1998, the Company signed a license agreement (the “2G License”) with the Ministry of Transport
and Infrastructure of Turkey (the “Turkish Ministry”), under which it was granted a 25-year GSM license in
exchange for a license fee of USD 500,000. The License permits the Company to operate as a stand-alone
GSM operator and releases it from some of the operating constraints in the Revenue Sharing Agreement,
which was in effect prior to the 2G License. Under 2G license, the Company pays in cash the Undersecretariat
of the Treasury (the “Turkish Treasury”) a monthly tax levy, namely a 'treasury share' equal to 15% of the
Company's gross revenue from Turkish GSM operations. The Company continues to build and operate its
GSM network and is authorized to, among other things, set its own tariffs within certain limits, charge peak
and off-peak rates, offer a variety of service and pricing packages, issue invoices directly to subscribers, collect
payments and deal directly with subscribers. Following the 3G tender held by the Information Technologies
and Communications Authority (“ICTA”) regarding the authorization for providing IMT-2000/UMTS
services and infrastructure, the Company has been granted the A-Type license (the “3G License”) providing
the widest frequency band, at a consideration of EUR 358,000 (excluding Value Added Tax (“VAT”)).
Payment of the 3G license was made in cash, following the necessary approvals, on 30 April 2009.
On 26 August 2015, “Authorization Tender on IMT Services and Infrastructure” publicly known as “4.5G
license” tender, was held by the ICTA and the Company was awarded with a total frequency band of
172.4 MHz for 13 years. The tender price is EUR 1,623,460 (excluding VAT of 18%). IMT authorization
period expires on 30 April 2029 and operators were able to commence service delivery for 4.5G starting from
1 April 2016. 2x1.4 MHz frequency band in 900MHz spectrum and 2 units of 2x5 MHz frequency bands in
2100 MHz spectrum were commenced on 1 December 2015, while remaining packages were commenced on
1 April 2016.
The Company is obliged to pay the ICTA a monthly treasury share equal to 90% of 15% of gross revenue and
10% is paid for a universal service fund. In addition, the Company pays annual contributions in an amount
equal to 0.35% of net revenue to the ICTA’s expenses and 5% of net revenue to ICTA as a frequency fee
(TRx).
On 21 October 2020, the following main amendments to the articles of association have been approved by the
Ordinary General Assembly:
(i)
(ii)
(iii)
The size of the board of directors has been increased from seven members to a total of nine
members;
15% of the total issued shares of Turkcell, owned by TVF Bilgi Teknolojileri Iletisim Hizmetleri
Yatirim Sanayi ve Ticaret Anonim Sirketi (“TVF BTIH”) as the surviving entity from the Turkcell
Holding A.S. (“Turkcell Holding”) / TVF BTIH merger, have been re-classified as a separate class
of Group A Shares (the “Group A Shares”);
A nomination privilege has been created on the Group A Shares, allowing the holders thereof to
nominate four candidates for appointment of five members of the board of directors of the
Company; a voting privilege has been created on the Group A Shares, allowing the holders thereof
to cast six votes for each Group A Share in respect of the appointment of
a. five members of the board of directors of the Company, and
b.
the chairman of the presiding committee of the general assembly of shareholders;
(iv)
(v)
(vi)
(vii)
All shareholders of the Company (including the holders of Group A Shares) are entitled to cast
one vote per share on all other matters submitted to a vote of Turkcell’s shareholders, including
the appointment of the residual four members of the board of directors of Turkcell (including
independent ones);
The chairman of the board of directors shall be elected among the members of the board of
directors elected through the exercise of the privileges granted to Group A Shares;
The meeting quorum requirement of the board of directors requires five members constituting the
majority of full number of its members, and the decision quorum requires the affirmative vote of
at least five members present in the meeting; and
So long as the above mentioned privileges are in effect, unlimited authority to represent and bind
Turkcell regulated under Article 370 of Turkish Commercial Code shall be exercised by two
members of the board of directors of the Company, including at least one member of the board of
directors of the Company appointed through the exercise of the said privileges by the holders of
Group A Shares.
The completion of the transactions announced on 17 June 2020 between the Company’s direct and indirect
shareholders and certain of its related parties, Turkiye Varlik Fonu (“TVF”), through Turkiye Varlik Fonu
Yonetimi A.S., TVF BTIH, T.C. Ziraat Bankasi A.S. (“Ziraat Bankasi”) took place on 22 October 2020, at the
completion date among other things, (i) Telia Finland Oy (“Telia”), the holder of 47.09% shares of Turkcell
Holding (indirectly 24.02% in Turkcell) divested of all of its interest in Turkcell’s shareholding structure by
selling its shares to TVF BTIH; (ii) Cukurova Telecom Holdings Limited, the holder of 52.91% shares of
Turkcell Holding according to public announcements (indirectly 26.98% in Turkcell) divested all of its interest
in shareholding structure by selling its shares to TVF BTIH; (iii) following the merger of Turkcell Holding
with TVF BTIH, IMTIS Holdings S.a r l. (“IMTIS Holdings”) acquired 24.8% of the issued shares of Turkcell,
from TVF BTIH.
As announced on 13 November 2020, IMTIS Holdings, the direct shareholder of the Company, holding
545,600,000 Group B ordinary and tradable shares corresponding to 24.8% of the issued shares, agreed to sell
110,000,000 of Turkcell shares corresponding to 5% of the issued shares to institutional investors. The
transaction is completed on 12 November 2020. Following completion of the transactions, capital shares and
voting rights of TVF BTIH and IMTIS Holdings in the Company have become 26.2% and 19.8%, respectively.
Proportion of the Company’s shares that are traded in domestic and foreign stock exchanges increased from
48.95% to 53.95% (Note 26).
The Group’s immediate and ultimate parents are TVF BTIH and TVF as of 31 December 2020, respectively.
TVF has been established with the Law No. 6741 and published in the Official Gazette dated 26 August 2016.
In order to ensure compliance with corporate governance principles of the Capital Markets Board (“CMB”),
three independent board members were appointed in 2013. Additionally, two board members were appointed
at the General Assembly dated 29 April 2013 as per the resolution of CMB. Also in 2013, two members were
chosen from the independent nominees list submitted by Telia to CMB. On 29 March 2018, in accordance
with the shareholder proposal at the Ordinary General Assembly, three new members were elected to serve for
three years instead of three members who are not among independent members appointed by the CMB. Two
new board members were appointed on 7 and 8 March 2019 in lieu of board members who had resigned at
various dates in 2019. These two board members were reappointed for three years in the Ordinary General
resigned on
Assembly Meeting held on 12 September 2019. One of
27 November 2019, and on 13 December 2019 a new board member was appointed for the vacant seat. Three
new independent board members were appointed in lieu of existing three independent board members in board
of directors with the CMB decision dated 5 March 2020.
the board members
8
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
304
F10
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F11
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Reporting entity (continued)
1.
On 21 October 2020, amendment on articles of association regarding increasing number of board of directors
from seven to nine was approved at the Ordinary General Assembly Meeting. On 22 October 2020, two board
members resigned. The Company’s board of directors consists of a total of five non-executive members
including three independent members as of 31 December 2020.
The consolidated financial statements of the Company as at and for the year ended 31 December 2020 comprise
the Company and its subsidiaries (together referred to as the “Group”) and the Group’s interest in associates
and a joint venture. Subsidiaries of the Company, their locations and their nature of operations are disclosed
in Note 40. The Company’s and each of its subsidiaries’ and associate’s financial statements are prepared as
at and for the year ended 31 December 2020.
2.
Basis of preparation and summary of significant accounting policies
This note provides a list of the significant accounting policies adopted in the preparation of these consolidated
financial statements to the extent they have not already been disclosed in the other notes below. These policies
have been consistently applied to all the years presented, unless otherwise stated. The consolidated financial
statements are for the Group consisting of the Company and its subsidiaries and the Group’s interest in an
associate and a joint venture.
(a) Compliance with IFRS
The consolidated financial statements of the Group have been prepared in accordance with International
Financial Reporting Standards (“IFRS”) and interpretations issued by the IFRS Interpretations Committee
(“IFRS IC”) applicable to companies reporting under IFRS. The financial statements comply with IFRS as
issued by the International Accounting Standards Board (“IASB”).
The accounting policies, presentation and methods of computation are consistent with those of the previous
financial year and corresponding reporting period, unless otherwise stated.
The Group adopted IFRS 9, “Financial Instruments” and IFRS 15, “Revenue from Contracts with Customers”
for the first time for the year commencing 1 January 2018. The Group also elected to early adopt IFRS 16,
“Leases” for the first time for the year commencing 1 January 2018.
The General Assembly has the power to amend and reissue the financial statements. The consolidated financial
statements as at and for the year ended 31 December 2019 were authorized for issue by the Board of Directors
on 20 February 2020.
The consolidated financial statements as at and for the year ended 31 December 2020 were authorized for issue
by the Board of Directors on 19 February 2021 and updated to reflect subsequent events after the original date
of authorization for inclusion in its annual report on Form 20-F.
(b) Historical cost convention
The accompanying consolidated financial statements are based on the statutory records, with adjustments and
reclassifications for the purpose of fair presentation in accordance with IFRS as issued by the IASB. The
financial statements have been prepared on a historical cost basis, except for the following measured at fair
value:
- Derivative financial instruments,
- Consideration payable in relation to the acquisition of Belarusian Telecom,
- Financial asset at fair value through other comprehensive income.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
(c) Functional and presentation currency
(i) Transactions and balances
Transactions denominated in foreign currencies are translated into the functional currency using the exchange
rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the
reporting date are translated into the functional currency using the exchange rates at that date.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are
translated to the functional currency using the exchange rates at the date when the fair value was determined.
Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain
or loss. For example, translation differences on non-monetary assets and liabilities such as assets held at fair
value through profit or loss are recognized in profit or loss as part of the fair value gain or loss and translation
differences on assets classified as at fair value through other comprehensive income are recognized in other
comprehensive income.
Foreign exchange gains and losses are recognized in profit or loss, except:
For capitalized foreign exchange differences relating to borrowings to the extent that they are regarded
as an adjustment to interest costs eligible for capitalization.
Foreign exchange differences are deferred in equity if they relate to qualifying cash flow hedges and qualifying
net investment hedges or are attributable to part of the net investment in a foreign operation. Foreign exchange
gains and losses are presented in the statement of profit or loss on a net basis within finance income or finance
costs.
(ii) Foreign operations
The results and financial position of foreign operations (none of which has the currency of a hyperinflationary
economy) that have a functional currency different from the presentation currency are translated into the
presentation currency as follows:
Assets and liabilities for each balance sheet presented are translated at the closing rate at the date of
that balance sheet,
Equity for each balance sheet presented is translated at historic cost at the date of transaction,
Income and expenses for each statement of profit or loss and statement of comprehensive income are
translated at average monthly exchange rates (unless this is not a reasonable approximation of the
cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses
are translated at the dates of the transactions) and
All resulting exchange differences are recognized in other comprehensive income and accumulated in
the foreign currency translation reserve, in equity.
On consolidation, exchange differences arising from the translation of borrowings and other financial
instruments designated as hedges of any net investment in foreign entities are recognized in other
comprehensive income. When a foreign operation is sold or any borrowings forming part of the net investment
are repaid the associated exchange differences are reclassified to profit or loss, as part of the gain or loss on
sale.
Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and
liabilities of the foreign operation and translated at the closing rate.
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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F12
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F13
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
(d) Use of estimates and judgments
The preparation of the consolidated financial statements requires the use of accounting estimates. Management
also needs to exercise judgment in applying the Group’s accounting policies. Actual results may differ from
these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Alterations to accounting estimates
are recognized in the period in which the estimates are revised and in any future periods affected.
Information about significant areas of estimation, uncertainty and critical judgments in applying accounting
policies that have the most significant effect on the amounts recognized in the consolidated financial
statements are described below:
Allowance for doubtful receivables
The Group maintains an allowance for doubtful receivables for estimated losses resulting from the inability of
the Group’s subscribers and customers to make required payments. The Group bases the allowance on the
likelihood of recoverability of trade receivables, receivables from financial services and other receivables;
when there is objective evidence of impairment as a result of one or more events that occurred after the initial
recognition of asset and that events have an impact on the estimated future cash flows of the financial asset or
group of financial assets that could be reliably estimated. The allowance is periodically reviewed. The
allowance charged to expenses is determined in respect of receivable balances, calculated as a specified
percentage of the outstanding balance in each aging group, with the percentage of the allowance increasing as
the aging of the receivable progresses.
Capitalization and useful lives of assets
The useful lives and residual values of the Group’s assets are estimated by management at the time the asset
is acquired and regularly reviewed for appropriateness. The Group defines useful lives of its assets in terms of
the assets’ expected utility to the Group. This judgment is based on the experience of the Group with similar
assets. In determining the useful life of an asset, the Group also follows technical and/or commercial
obsolescence arising on changes or improvements from a change in the market. The useful lives of the
telecommunication licenses are based on the duration of the license agreements.
Gross versus net presentation of revenue
When the Group acts as principal in sale of goods or rendering of services, revenue from customers and costs
with suppliers are reported on a gross basis. When the Group acts as agent in sale of goods or rendering of
services, revenue from customers and costs related to suppliers are reported on a net basis, representing the net
margin earned. Whether the Group is acting as principal or agent depends on management’s analysis of both
legal form and substance of the agreement between the Group and its business partners; such judgments impact
the amount of reported revenue and costs but do not impact reported assets, liabilities or cash flows.
Contracted handset sales
The Company, the distributors and dealers offer joint campaigns to the subscribers which may include the sale
of device by the dealer and/or distributor and a communication service to be provided by the Company. The
Company does not recognize any revenue for the device in these transactions by considering the factors below:
- the Company is not the primary obligor for the sale of handset,
- the Company does not have control over the sale prices of handsets,
- the Company has no inventory risk.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
2.
Basis of preparation and summary of significant accounting policies (continued)
(d) Use of estimates and judgments (continued)
Multiple performance obligations and price allocation
In arrangements which include multiple elements where the Group acts as principal, the Group considers that
these bundled elements involve consideration in the form of a fixed fee or a fixed fee coupled with a continuing
payment stream. A good or service is distinct if both of the following criteria are met:
The good or service is capable of being distinct,
The promise to transfer the good or service is distinct within the context of the contract.
The arrangement consideration is allocated to each performance obligation identified in the contract based on
relative stand-alone selling prices. If an element of a transaction is not distinct, then it is accounted for as an
integral part of the remaining elements of the transaction.
Income taxes
The calculation of income taxes involves a degree of estimation and judgment in respect of certain items whose
tax treatment cannot be finally determined until resolution has been reached with the relevant tax authority or,
as appropriate, through formal legal process.
As part of the process of preparing the consolidated financial statements, the Group is required to estimate the
income taxes in each of the jurisdictions and countries in which it operates. This process involves estimating
the actual current tax exposure together with assessing temporary differences resulting from differing
treatment of items, such as deferred revenue and reserves for tax and accounting purposes.
The recognition of deferred tax assets is based upon whether it is probable that future taxable profits will be
available against which unrecognized tax losses and temporary differences can be utilized. Recognition,
therefore, involves judgment regarding the future financial performance of the particular legal entity in which
the deferred tax asset has been recognized.
Provisions, contingent liabilities and contingent assets
As detailed and disclosed in Note 38, the Group is involved in a number of investigations and legal proceedings
(both as a plaintiff and as a defendant) arising in the ordinary course of business. All these investigations and
litigations are evaluated by the Group Management and disclosed (unless information concerning provisions
are very sensitive, and full disclosure could prejudice the outcome of cases) or accounted for in the consolidated
financial statements. Future results or outcome of these investigations and litigations might differ from these
Group Management’s expectations. As at the reporting date, the Group Management believes that appropriate
recognition criteria and measurement basis are applied to provisions, contingent liabilities and contingent
assets and that sufficient information is disclosed in the notes to enable users to understand their nature, timing
and amount by considering current conditions and circumstances.
Annual impairment review
The Group’s non-current are tested for impairment whenever events or changes in circumstances indicate that
the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the
asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s
fair value less costs of disposal and value in use.
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
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TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F15
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
2.
Basis of preparation and summary of significant accounting policies (continued)
(d) Use of estimates and judgments (continued)
Fair value measurements and valuation process
(h) Principles of consolidation and equity accounting (continued)
(i)
Business combinations (continued)
Some of the Company’s assets and liabilities are measured at fair value for financial reporting purposes. In
estimating the fair value of an asset or liability, the Company uses market-observable data to the extent it is
available. Where Level 1 and 2 inputs are not available, the Company can engage third party qualified experts
to perform the valuation, if necessary. The management works closely with the qualified external experts to
establish the appropriate valuation techniques and inputs to the model. Information about the valuation
techniques and inputs used in determining the fair value of various assets and liabilities is disclosed in
Note 36.
(e) Changes in accounting policies
Other than the adoption of the new and revised standards as explained in Note 2(z), the Group did not make
any significant changes to its accounting policies during the current year.
(f) Changes in accounting estimates
If the application of changes in the accounting estimates affects the financial results of a specific period, the
changes in the accounting estimates are applied in that specific period, if they affect the financial results of
current and following periods; the accounting estimate is applied prospectively in the period in which such
change is made. A change in the measurement basis applied is a change in an accounting policy, and is not a
change in an accounting estimate.
The Company does not have significant changes in accounting estimates during the year.
(g) Comparative information and revision of prior period financial statements
The consolidated financial statements of the Group have been prepared consistent with prior periods.
(h) Principles of consolidation and equity accounting
(i)
Business combinations
Business combinations are accounted for using the acquisition method. The consideration transferred in a
business combination comprises:
The fair value of the assets transferred,
Liabilities incurred to the former owners of the acquired business,
Equity interests issued by the Group,
The fair value of any asset or liability resulting from a contingent consideration arrangement, and
The fair value of any pre-existing equity interest in the subsidiary.
Acquisition-related costs are expensed as incurred.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are,
with limited exceptions, measured initially at their fair values at the acquisition date.
Goodwill is measured as the excess of the consideration transferred, amount of any non-controlling interest in
the acquired entity, and acquisition-date fair value of any previously held equity interest in the acquired entity
over the fair value of the net identifiable assets acquired. If those amounts are less than the fair value of the net
identifiable assets of the business acquired, the difference is recognized directly in profit or loss as a bargain
purchase. The Group recognizes any non-controlling interest in the acquired entity on an acquisition-by-
acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired
entity’s net identifiable assets.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted
to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing
rate, being the rate at which a similar borrowing could be obtained from an independent financier under
comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial
liability are subsequently remeasured to fair value with changes in fair value recognized in profit or loss.
Contingent consideration classified as equity is not subject to remeasurement. Instead, any gain or loss at
settlement is recorded as an adjustment to equity through other comprehensive income.
If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s
previously held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or
losses arising from such remeasurement are recognized in profit or loss.
(ii)
Subsidiaries
Subsidiaries comprise all entities over which the Group has control. The Group controls an entity when the
Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability
to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated
from the date on which control is transferred to the Group. They are deconsolidated from the date that control
ceases.
The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there
are changes to one or more of the three elements of control listed above.
Intercompany transactions, balances and unrealized gains on transactions between group companies are
eliminated. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of
the transferred asset.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies
adopted by the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated
statement of profit or loss, statement of comprehensive income, statement of changes in equity and statement
of financial position, respectively.
Non-controlling interest has not been attributed to Belarus Telekom on the grounds that net assets of Belarus
Telekom is negative, Belarus Telekom is financed solely by the Company and management’s assessment of
relevant articles of the share purchase agreement with the non-controlling shareholder.
financial
loans amounting
The Group sold six
to TL 439,364 between 2017 and 2019
to Aktif Yatirim Bankasi A.S. Turkcell Varlik Finansmani Fund (the “Fund”) founded by Aktif Yatirim
Bankasi A.S. in order to create funds for the issuance of Asset Backed Securities (“ABS”) which were issued
by the Fund in a structure where Turkcell Finansman A.S. (“Turkcell Finansman”) acted as the source
organization. These aforementioned funds are all expired and there are no issued ABS as of
31 December 2020. Turkcell Finansman transferred its contractual rights to receive cash flows from the
financial loans that have been sold to the Fund resulting in de-recognition of the related assets from its financial
statements. Moreover, the Group did not consolidate the Fund since the activities of the Fund are not controlled
by the Group and the Fund has been defined as a structured entity.
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
310
F16
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F17
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
2. Basis of preparation and summary of significant accounting policies (continued)
2. Basis of preparation and summary of significant accounting policies (continued)
(h) Principles of consolidation and equity accounting (continued)
(iii) Changes in ownership interests
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions
with equity owners of the Group. A change in ownership interest results in an adjustment between the carrying
amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any
difference between the amount of the adjustment to the non-controlling and any consideration paid or received
is recognized in a separate reserve within equity attributable to owners of the Company.
When the Group ceases to consolidate or equity account for an investment because of a loss of control, joint
control or significant influence, any retained interest in the entity is remeasured to its fair value with the change
in carrying amount recognized in profit or loss. This fair value becomes the initial carrying amount for the
purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset.
In addition, any amounts previously recognized in other comprehensive income in respect of that entity are
accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that
amounts previously recognized in other comprehensive income are reclassified to profit or loss.
If the ownership interest in a joint venture or an associate is reduced but joint control or significant influence
is retained, only a proportionate share of the amounts previously recognized in other comprehensive income
are reclassified to profit or loss where appropriate.
(iv) Business combinations under common control
Business combinations between entities or businesses under common control are excluded from the scope of
IFRS 3. In a business combination under common control, assets and liabilities of the acquired entity are stated
at predecessor carrying values. Any difference between the consideration given and the aggregate book value
of the assets and liabilities of the acquired entity at the date of the transaction is recognized in equity. The
acquired entity’s results and financial position are incorporated as if both entities (acquirer and acquiree) had
always been combined, or using the results from the date when either entity joined the Group, where such a
date is later.
(v) Put option over shares relating to non-controlling interests
Where a put option is written by the Group on shares in an existing subsidiary held by non-controlling interests,
the Group recognizes a financial liability at the present value of the redemption amount to reflect the put option.
If the ownership risks and rewards of the shares relating to the put option is attributable to Group, the non-
controlling interest is derecognized. The difference between the put option liability and the non-controlling
interests derecognized is recognized in equity. For business combinations after 1 January 2009, subsequent
changes in the fair value of the put option liability are recognized in profit or loss.
Reserve for put option over shares relating to non-controlling interests included in equity arises from the
difference between the fair value of the put option written by Fintur Holdings B.V. (“Fintur”) on non-
controlling shares in one of its subsidiaries and the derecognized non-controlling interests relating to that put
option.
(h) Principles of consolidation and equity accounting (continued)
(vi) Investments in associates and joint ventures
An associate is an entity over which the Group has significant influence, but not control or joint control. This
is generally the case where the Group holds between 20% and 50% of the voting rights. Investments in
associates are accounted for using the equity method of accounting after initially being recognized at cost.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights
to the net assets of the joint arrangement. The results and assets and liabilities of joint ventures are incorporated
in these consolidated financial statements using the equity method of accounting.
Under the equity method of accounting, an investment in an associate is initially recognized at cost and adjusted
thereafter to recognize the Group’s share of the post-acquisition profits or losses of the investee in profit or
loss, and the Group’s share of movements in other comprehensive income of the investee in other
comprehensive income. Dividends received or receivable from associates are recognized as a reduction in the
carrying amount of the investment.
When the Group’s share of losses in an equity-accounted investment equals or exceeds its interest in that entity,
including any other unsecured long-term receivables, the Group does not recognize further losses, unless it has
incurred obligations or made payments on behalf of the other entity.
Unrealized gains on transactions between the Group and its associates are eliminated to the extent of the
Group’s interest in these entities. Unrealized losses are also eliminated unless the transaction provides evidence
of an impairment of the asset transferred. Accounting policies of equity accounted investees have been changed
where necessary to ensure consistency with the policies adopted by the Group.
On acquisition of an associate, any excess of the cost of the investment over the Group’s share of the net fair
values of the associate’s identifiable assets and liabilities is recognized as goodwill, which is included in the
carrying amount of the investment. Any excess of the Group’s share of the net fair value of the associate’s
identifiable assets and liabilities over the cost of the investment is included as part of the Group’s share of the
associate profit or loss in the period in which the investment is acquired.
The carrying amount of equity-accounted investments is tested for impairment. The Group measures an
associate that is classified as held for sale at the lower of its carrying amount at the date of classification as
held for sale and fair value less costs of disposal. Equity accounting ceases once an associate is classified as
held for sale.
Financial instruments
(i)
Classification
From 1 January 2018, the Group classifies its financial assets in the following measurement categories:
- Those to be measured subsequently at fair value (either through OCI or through profit or loss) and
- Those to be measured at amortized cost.
The classification depends on the Group’s business model for managing the financial assets and the contractual
terms of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For
investments in equity instruments that are not held for trading, this will depend on whether the Group has made
an irrevocable election at the time of initial recognition to account for the equity investment at fair value
through other comprehensive income (FVOCI).
The Group reclassifies debt investments when and only when its business model for managing those assets
changes.
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TURKCELL ILETISIM HIZMETLERI AS
F19
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
Financial instruments (continued)
Recognition and derecognition
2.
(i)
Regular way purchases and sales of financial assets are recognized on trade date, the date on which the Group
commits to purchase or sell the asset. Financial assets are derecognized when the rights to receive cash flows
from the financial assets have expired or have been transferred and the Group has transferred substantially all
the risks and rewards of ownership.
Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset
not at fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition
of the financial asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss.
Financial assets with embedded derivatives are considered in their entirety when determining whether their
cash flows are solely payment of principal and interest.
(i) Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset
and the cash flow characteristics of the asset. There are three measurement categories into which the Group
classifies its debt instruments:
- Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortized cost. Interest income from these financial
assets is included in finance income using the effective interest rate method. Any gain or loss arising on
derecognition is recognized directly in profit or loss.
- FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial assets, where
the assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements
in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest
income and foreign exchange gains and losses which are recognized in profit or loss. When the financial asset
is derecognized, the cumulative gain or loss previously recognized in OCI is reclassified from equity to profit
or loss. Interest income from these financial assets is included in finance income using the effective interest
rate method.
- FVPL: Assets that do not meet the criteria for amortized cost or FVOCI are measured at FVPL. A gain or
loss on a debt instruments that is subsequently measured at FVPL is recognized in profit or loss in the period
in which it arises.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
Financial instruments (continued)
Measurement (continued)
2.
(i)
(ii) Equity instruments
The Group subsequently measures all equity investments at fair value. Where the Group’s management has
elected to present fair value gains and losses on equity investments in OCI, there is no subsequent
reclassification of fair value gains and losses to profit or loss following the derecognition of the investment.
Dividends from such investments continue to be recognized in profit or loss as other income when the Group’s
right to receive payments is established.
Changes in the fair value of financial assets at FVPL are recognized in the statement of profit or loss as
applicable. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI
are not reported separately from other changes in fair value.
Impairment
From 1 January 2018, the Group assesses on a forward looking basis the expected credit losses associated with
its debt instruments carried at amortized cost and FVOCI. The impairment methodology applied depends on
whether there has been a significant increase in credit risk.
Loss allowances are measured on either of the following bases.
12 month expected credit losses (ECLs): these are ECLs that result from possible default events within
the 12 months after the reporting date and
Lifetime ECLs: these are ECLs that result from all possible default events over the expected life of a
financial instrument.
The Group applies lifetime ECL measurement for all group companies except Turkcell Finansman which
applies both 12 month and lifetime ECL (general approach).
Offsetting financial assets and financial liabilities
Financial assets and liabilities are offset and the net amount presented in the statement of financial position
where the Group has a legally enforceable right to offset the recognized amounts, and there is an intention to
settle on a net basis or to realize the asset and settle the liability simultaneously. This policy had also been
applied before 1 January 2018.
Cash and cash equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on
hand, deposits held at call with financial institutions and other short-term, highly liquid investments with
original maturities of three months or less that are readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.
Trade receivables
Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course
of business. If collection of the amounts is expected in one year or less they are classified as current assets. If
not, they are presented as non-current assets.
Trade receivables are recognized initially at fair value and subsequently measured at amortized cost using the
effective interest method, less provision for impairment. See Note 36 for a description of the Group’s
impairment policies.
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TURKCELL ILETISIM HIZMETLERI AS
F21
2.
(i)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
Financial instruments (continued)
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial
year which are unpaid. Trade and other payables are presented as current liabilities unless payment is not due
within 12 months after the reporting period. They are recognized initially at their fair value and subsequently
measured at amortized cost using the effective interest method.
Related parties
A related party is a person or entity that is related to the Group.
(a) A person or a close member of that person’s family is related to the Group if that person:
(i) has control or joint control of the Group
(ii) has significant influence over the Group; or
(iii) is a member of the key management personnel of the Group or of a parent of the Group.
(b) An entity is related to the Group if any of the following conditions applies:
(i) The entity and the Group are members of the same group (which means that each parent, subsidiary
and fellow subsidiary is related to the others).
(ii) One entity is an associate or joint venture of the other entity (or an associate or joint venture of a
member of a group of which the other entity is a member).
(i)
Financial instruments (continued)
Derivatives and hedging activities
Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are
subsequently remeasured to their fair value at the end of each reporting period.
Fair values of foreign exchange forwards, interest rate and foreign exchange swaps (IRS, Cross Currency
Swaps etc.) and options are calculated with market levels of interest rates and Central Bank of Republic of
Turkey (“CBRT”) exchange rates via Bloomberg financial terminal. If market levels are not available for
valuation date, fair value for forward contracts will be the value of the discounted future value of the difference
between contract price level and forward value of CBRT exchange rate with risk free rates for the period.
Interest rate and currency swaps will be valued with the difference of the discounted cash flows of each leg of
the swaps using risk free rates and CBRT exchange rates. Option transactions will be valued with option
pricing models using risk free rates and CBRT exchange rates.
The accounting for subsequent changes in fair value depends on whether the derivative is designated as a
hedging instrument, and if so, the nature of the item being hedged. The Group designates certain derivatives
as hedges of a particular risk associated with the cash flows of recognized assets and liabilities and highly
probable forecast transactions (cash flow hedges).
At inception of the hedge relationship, the Group documents the economic relationship between hedging
instruments and hedged items including whether changes in the cash flows of the hedging instruments are
expected to offset changes in the cash flows of hedged items. The Group documents its risk management
objective and strategy for undertaking its hedge transactions.
(iii) Both entities are joint ventures of the same third party.
(i)
Cash flow hedges that qualify for hedge accounting
(iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity.
(v) The entity is a post-employment benefit plan for the benefit of employees of either the Group or
an entity related to the Group. If the Group is itself such a plan, the sponsoring employers are also
related to the Group.
(vi) The entity is controlled or jointly controlled by a person identified in (a).
(vii) A person identified in (a) (i) has significant influence over the entity or is a member of the key
management personnel of the entity (or of a parent of the entity).
Borrowings
Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently
measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption
amount is recognized in profit or loss over the period of the borrowings using the effective interest method.
Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent
that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the
draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be
drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the
facility to which it relates.
Borrowings are removed from the statement of financial position when the obligation specified in the contract
is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has
been extinguished or transferred to another party and the consideration paid, including any non-cash assets
transferred or liabilities assumed, is recognized in profit or loss.
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow
hedges is recognized in the cash flow hedge reserve within equity. The gain or loss relating to the ineffective
portion is recognized immediately in profit or loss.
Gains or losses relating to the effective portion of the change in intrinsic value of the options are recognized
in the cash flow hedge reserve within equity. The changes in the time value of the options that relate to the
hedged item (“aligned time value”) are recognized within OCI in the costs of hedging reserve within equity.
Amounts accumulated in equity are reclassified in the periods when the hedged item affects profit or loss, as
follows:
- Where the hedged item subsequently results in the recognition of a non-financial asset, both the deferred
hedging gains and losses and the deferred time value of the option contracts or deferred forward points, if any,
are included within the initial cost of the asset. The deferred amounts are ultimately recognized in profit or
loss as the hedged item affects profit or loss.
- The gain or loss relating to the effective portion of the interest rate swaps hedging variable rate borrowings
is recognized in profit or loss within finance cost at the same time as the interest expense on the hedged
borrowings.
When a hedging instrument expires, or is sold or terminated, or when a hedge no longer meets the criteria for
hedge accounting, any cumulative deferred gain or loss and deferred costs of hedging in equity at that time
remains in equity until the forecast transaction occurs, resulting in the recognition of a non-financial asset.
When the forecast transaction is no longer expected to occur, the cumulative gain or loss and deferred costs of
hedging that were reported in equity are immediately reclassified to profit or loss.
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316
F22
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F23
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
Financial instruments (continued)
Derivatives and hedging activities (continued)
2.
(i)
(i)
Cash flow hedges that qualify for hedge accounting (continued)
Certain derivative instruments do not qualify for hedge accounting. Changes in the fair value of any derivative
instrument that does not qualify for hedge accounting are recognized immediately in profit or loss.
The Group has started to apply hedge accounting as of 1 July 2018 for existing participating cross currency
swap and cross currency swap transactions in accordance with IFRS 9 hedge accounting requirement. IFRS 9
includes new hedge accounting rules aiming alignment with risk management activities.
The Group enters into participating cross currency swap and cross currency swap transactions in order to hedge
the changes in cash flows of foreign exchange denominated fixed and floating rate financial instruments. While
applying cash flow hedge accounting, the effective portion of the changes in the fair value of the hedging
instrument is accounted for under “other comprehensive income/expense items to be reclassified to profit or
loss” as a “hedging reserve” in equity, and the ineffective portion is recognized in profit or loss. The changes
recognized in equity is reclassified and included in profit or loss in the same period when the hedged cash
flows effect the profit or loss. In addition, time value of options included in participating cross currency swaps
are accounted for cost of hedging and recognized under other comprehensive income.
The new effectiveness test model may be qualitative depending on the complexity of hedging relationship
provided that it is prospective only. The 80-125% range in IAS 39 is replaced by an objectives-based test that
focuses on the economic relationship between the hedged item and the hedging instrument, and the effect of
credit risk on that economic relationship.
Under IFRS 9, a hedging relationship is discontinued in its entirety when as a whole it ceases to meet the
qualifying criteria after considering the rebalancing of the hedging relationship. Voluntary discontinuation
when the qualifying criteria are met is prohibited. Hedge accounting is discontinued when the risk management
objective for the hedging relationship has changed, the hedging instrument expires or is sold, terminated or
exercised, there is no longer an economic relationship between the hedged item and hedging instrument or
when the effect of credit risk starts dominating the value changes that result from the economic relationship.
When the Group discontinues hedge accounting for a cash flow hedge it shall account for the amount that has
been accumulated in the cash flow hedge reserve in accordance as follows;
-if the hedged future cash flows are still expected to occur, that amount shall remain in the cash flow hedge
reserve until the future cash flows occur.
-When a hedging instrument expires, or is sold or terminated, or when a hedge no longer meets the criteria for
hedge accounting, any cumulative deferred gain or loss and deferred costs of hedging in equity at that time
remains in equity until the forecast transaction occurs, resulting in the recognition of a non-financial asset.
When the forecast transaction is no longer expected to occur, the cumulative gain or loss and deferred costs of
hedging that were reported in equity are immediately reclassified to profit or loss.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
Financial instruments (continued)
2.
(i)
Derivatives and hedging activities (continued)
(ii) Foreign currency hedge of net investments in foreign operations
The Company designates its foreign currency bank loans to hedge its net investment in a foreign operation.
Foreign exchange gains or losses on the hedging instrument relating to the effective portion of the foreign
currency hedge of net investments in foreign operations are recognized in other comprehensive income while
any gains or losses relating to the ineffective portion is recognized in the income statement. Tax effects of
foreign exchange gains or losses on the hedging instrument relating to the effective portion of the foreign
currency hedge of net investments in foreign operations is recognized under other comprehensive income as
well.
On disposal of the foreign operation, the cumulative value of any such gains or losses recorded in equity is
transferred to the income statement (Note 16).
(j) Property, plant and equipment
(i) Recognition and measurement
Items of property, plant and equipment are stated at historical cost less depreciation and impairment losses.
Property, plant and equipment related to the Company and its subsidiaries operating in Turkey are adjusted for
the effects of inflation during the hyperinflationary period ended on 31 December 2005. Since the inflation
accounting commenced on 1 January 2011, property, plant and equipment related to the subsidiaries operating
in Belarus are adjusted for the effects of inflation. However, the decrease in inflation rate in subsequent years
led the three-year cumulative rate as of the end of 2014 to decrease to 65%. Accordingly, the economy of
Belarus was considered as transitioning out of hyperinflationary status and in 2015 it was determined to be
appropriate to cease applying IAS 29. Therefore, subsidiaries operating in Belarus ceased applying IAS 29 in
2015.
Historical cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-
constructed assets includes cost of materials and direct labor, any other costs directly attributable to bringing
the asset to a working condition for its intended use and the costs of dismantling and removing the items and
restoring the site on which they are located, if any.
Purchased software that is integral to the functionality of the related equipment is capitalized as part of that
equipment. When parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items of property, plant and equipment.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These are
included in profit or loss.
Changes in the obligation to dismantle, remove assets on sites and to restore sites on which they are located,
other than changes deriving from the passing of time, are added or deducted from the cost of the assets in the
period in which they occur. The amount deducted from the cost of the asset shall not exceed the balance of the
carrying amount on the date of change, and any excess balance is recognized immediately in profit or loss. An
asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount
is greater than its estimated recoverable amount.
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318
F24
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F25
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
(j) Property, plant and equipment (continued)
(ii) Subsequent costs
Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the Group and the
cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate
asset is derecognized when replaced. All other repairs and maintenance are charged to profit or loss during the
reporting period in which they are incurred.
(iii) Depreciation
Depreciation is calculated using the straight-line method to allocate their cost, net of their residual values, over
their estimated useful lives.
Land is not depreciated.
The estimated useful lives are as follows:
Buildings
Mobile network infrastructure
Fixed network infrastructure
Call center equipment
Equipment, fixtures and fittings
Motor vehicles
Leasehold improvements
21 – 25 years
4 – 20 years
3 – 25 years
4 – 8 years
2 – 10 years
4 – 6 years
3 – 5 years
Depreciation methods, useful lives and residual values are reviewed, and adjusted if appropriate, at the end of
each reporting period.
(iv) Borrowing costs
General and specific borrowing costs that are directly attributable to the acquisition, construction or production
of a qualifying asset are capitalized during the period that is required to complete and prepare the asset for its
intended use or sale. Qualifying assets are assets that necessarily take a substantial period to get ready for their
intended use or sale.
Other borrowing costs are expensed in the period in which they are incurred.
(k)
Intangible assets
(i)
Telecommunication licenses
Separately acquired telecommunication licenses are stated at historical cost adjusted for the effects of inflation
during the hyperinflationary period, where applicable, less amortization and impairment losses.
Amortization
Amortization is recognized in the statement of profit or loss on a straight-line basis by reference to the license
period. The useful lives for telecommunication licenses are as follows:
Telecommunications licenses
3 – 25 years
The Company has been granted the 2G, 3G and 4.5G licenses on 27 April 1998, 30 July 2009 and
26 August 2015, respectively. The licenses are effective for 25, 20 and 13 years, respectively.
(k)
Intangible assets (continued)
(ii) Computer software
Acquired computer software licenses are capitalized based on the costs incurred to acquire and bring to use
the specific software.
Costs associated with maintaining computer software programs are recognized as an expense as incurred.
Development costs that are directly attributable to the design and testing of identifiable and unique software
products controlled by the Group are recognized as intangible assets when the following criteria are met:
It is technically feasible to complete the software such that it will be available for use,
Management intends to complete the software and use or sell it,
There is an ability to use or sell the software,
Adequate technical, financial and other resources to complete the development and to use or sell the
It can be demonstrated how the software will generate probable future economic benefits,
software are available and
The expenditure attributable to the software during its development can be reliably measured.
Directly attributable costs that are capitalized as part of the software include employee costs and an appropriate
portion of relevant overheads.
Research expenditure and development expenditure that do not meet the criteria above are recognized as an
expense as incurred. Development costs previously recognized as an expense are not recognized as an asset in
a subsequent period.
Capitalized development costs are recorded as intangible assets and amortized from the point at which the
asset is ready for use.
Amortization
Amortization is recognized in the statement of profit or loss on a straight-line basis over the estimated useful
lives. The useful lives for computer software are as follows:
Computer software
3 – 8 years
Amortization methods, useful lives and residual values are reviewed, and adjusted if appropriate, at the end of
each reporting period.
(iii) Other intangible assets
Other intangible assets that are acquired by the Group which have finite useful lives are stated at historical cost
adjusted for the effects of inflation during the hyperinflationary period, where applicable, less amortization
and impairment losses. Indefeasible Rights of Use (“IRU”) are rights to use a portion of an asset’s capacity
granted for a fixed period of time. IRUs are recognized as intangible asset when the Group has specific
indefeasible rights to use an identified portion of an underlying asset and the duration of the right is for the
major part of the underlying asset's useful economic life. IRUs are amortized over the shorter of the underlying
asset's useful economic life and the contract term.
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TURKCELL ILETISIM HIZMETLERI AS
F27
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
(k)
Intangible assets (continued)
(iii) Other intangible assets (continued)
Amortization
Amortization is recognized in the statement of profit or loss on a straight-line basis over the estimated useful
lives. The useful lives for computer software are as follows:
Transmission line software
Central betting system operating right
Customer base
Brand name
Indefeasible right of use
5 – 10 years
7 – 10 years
2 – 15 years
9 – 10 years
15 years
Amortization methods, useful lives and residual values are reviewed, and adjusted if appropriate, at the end of
each reporting period.
Goodwill
Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill is not amortized but it is
tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might
be impaired, and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an
entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to
those cash-generating units or groups of cash-generating units that are expected to benefit from the business
combination in which the goodwill arose. The units or groups of units are identified at the lowest level at which
goodwill is monitored for internal management purposes, being the operating segments.
(l)
Investment properties
Recognition and measurement
Investment properties are properties held for rental yields and/or for capital appreciation (including property
under construction for such purposes). Investment properties are stated at historical cost less depreciation and
impairment losses.
An investment property is derecognized upon disposal or when the investment property is permanently
withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising
on derecognition of the property (calculated as the difference between the net disposal proceeds and the
carrying amount of the asset) is included in profit or loss in the period in which the property is derecognized.
Depreciation
Depreciation is calculated using the straight-line method to allocate their cost, net of their residual values, over
their estimated useful lives. The estimated useful lives are as follows:
Investment Property
Depreciation methods, useful lives and residual values are reviewed, and adjusted if appropriate, at the end
of each reporting period.
25 - 45 years
(m) Inventories
Inventories are stated at the lower of cost and net realizable value. Net realizable value is the estimated selling
price in the ordinary course of business, less the estimated costs necessary to make the sale. Cost of inventory
is determined using the weighted average method and comprises all costs of purchase and other costs incurred
in bringing the inventories to their present location and condition. Costs of purchased inventory are determined
after deducting rebates and discounts. At 31 December 2020 and 2019, inventories mainly consisted of mobile
phone and its accessories, tablet, sim-cards, and tower construction materials.
(n)
Impairment of assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortization and are tested
annually for impairment, or more frequently if events or changes in circumstances indicate that they might be
impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s
carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value
less costs of disposal and its value in use. Fair value is the price that would be received to sell an asset or paid
to transfer a liability in an orderly transaction between market participants at the measurement date.
Value in use is the present value of the future cash flows expected to be derived from an asset or cash-
generating unit. For the purposes of assessing impairment, assets are grouped at the lowest levels (cash-
generating units) for which there are separately identifiable cash inflows which are largely independent of the
cash inflows from other assets or groups of assets. Non-financial assets other than goodwill that suffered an
impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
(o) Employee benefits
(i)
Short-term obligations
Liabilities for salaries including non-monetary benefits that are expected to be settled wholly within
12 months after the end of the period in which the employees render the related service are recognized in
respect of employees’ services up to the end of the reporting period and are measured at the amounts expected
to be paid when the liabilities are settled. The liabilities are presented as employee benefit obligations in the
statement of financial position.
(ii) Termination benefits
In accordance with the labor law in Turkey, the Company and its subsidiaries in Turkey are required to make
lump-sum payments to employees who have completed one year of service and whose employment is
terminated without cause or who retire, are called up for military service or die. Such payments
are calculated based on 30 days' pay up to a of maximum full TL 7,117 as at 31 December 2020
(31 December 2019: TL 6,380), per year of employment at the rate of pay applicable at the date of retirement
or termination. Termination benefits paid to key executive officers are presented as other expenses. Reserve
for employee termination benefits is computed and reflected in the consolidated financial statements on a
current basis. Discount rate used for calculating employee termination benefit as of 31 December 2020 is
3.01% (31 December 2019: 3.60%). The reserve is calculated by estimating the present value of future probable
obligation of the Company and its subsidiaries in Turkey arising from retirement of employees. Reserve for
employee termination benefits is calculated annually by independent actuaries using the projected unit credit
method.
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TURKCELL ILETISIM HIZMETLERI AS
F29
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
(o) Employee benefits (continued)
(iii) Defined contribution plans
For defined contribution plans, the Group pays contributions to publicly or privately administered pension
insurance plans on a mandatory, contractual or voluntary basis. The Group has no further payment obligations
once the contributions have been paid. The contributions are recognized as employee benefit expense when
they are due. Prepaid contributions are recognized as an asset to the extent that a cash refund or a reduction in
the future payments is available.
(iv) Share-based payments
The Group provides a cash-settled share-based payment plan for selected employees in return for their services.
For cash-settled share-based payment transactions, the Group measures services received and the liability
incurred at the fair value of the liability. Liabilities for cash-settled share-based payment plan are recognized
as employee benefit expense over the relevant service period. The fair value of the liability is re-measured at
each reporting date and at the settlement date. Any changes in fair value are recognized in profit or loss for the
period.
(v) Personnel bonus
Provision for bonus is provided when the bonus is a legal obligation, or past practice would make the bonus a
constructive obligation and the Group is able to make a reliable estimate of the obligation.
(p) Provisions
A provision is recognized if, as a result of a past event, the Group has a present legal or constructive obligation
that can be estimated reliably, and it is probable that an outflow of resources will be required to settle the
obligation.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement
is determined by considering the class of obligations as a whole. A provision is recognized even if the
likelihood of an outflow with respect to any one item included in the same class of obligations may be small.
Provisions are measured at the present value of management’s best estimate of the outflow required to settle
the present obligation at the end of the reporting period. The discount rate used to determine the present value
is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to
the liability. The increase in the provision due to the passage of time is recognized as interest expense.
Onerous contracts
Present obligation arising under an onerous contract is recognized and measured as a provision. An onerous
contract is considered to exist where the Group has a contract under which the unavoidable costs of meeting
the obligations under the contract exceed the economic benefits expected to be received under it.
Dismantling, removal and restoring sites obligation
The Group is required to incur certain costs in respect of a liability to dismantle and remove assets and to
restore sites on which the assets were located. The dismantling costs are calculated according to best estimate
of future expected payments discounted at a pre-tax discount rate that reflects current market assessments of
the time value of money and the risks specific to the liability.
(q) Revenue
Revenue is recognized at the amount of the transaction price that is allocated to the performance obligation.
The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for
transferring promised goods or services to a customer. Revenue is recognized when control is transferred to
the customer.
Revenue from telecommunication services includes postpaid and prepaid revenue from voice, data, messaging
and value-added services, interconnect revenue, monthly fixed fees, SIM card sales and roaming revenue. The
Company transfers control of these services over time and, therefore, satisfies the performance obligations and
recognizes revenue from telecommunication services over time.
With respect to prepaid revenue, the Group generally collects cash in advance by selling prepaid top up to
distributors. In such cases, the Group does not recognize revenue until subscribers use the telecommunication
services.
Services may be bundled with other products and services and these bundled elements involve consideration
in the form of a fixed fee or a fixed fee coupled with a continuing payment stream. A good or service is distinct
if both of the following criteria are met:
The good or service is capable of being distinct,
The promise to transfer the good or service is distinct within the context of the contract.
The arrangement consideration is allocated to each performance obligation identified in the contract on a
relative stand-alone selling price. If an element of a transaction is not a distinct, then it is accounted for as an
integral part of the remaining elements of the transaction.
Revenue from device sales is recognized when control of the device has transferred, being the time when
delivered to the end customer. For device sales made to intermediaries, revenue is recognized at the time when
control of the device has been transferred, being when the products are delivered to the intermediary and the
intermediary has no general right to return the device to receive a refund. If control is not transferred, revenue
is deferred until sale of the device to an end customer by the intermediary or expiry of any right of return.
The Group, the distributors and dealers offer joint campaigns to the subscribers which may include the sale of
device by the dealer and/or the distributor and the sale of communication service by the Group. In certain
campaigns, dealers make the handset sale to the subscribers, the instalments of which will be collected by the
Group based on the letters of undertaking signed by the subscribers. With the letter of undertaking, the dealer
assigns its receivables from handset sales to the distributor and the distributor assigns its receivables to the
Group.
The Group pays the distributor the net present value of the instalments to be collected from the subscribers and
recognizes contracted receivables in its statement of financial position. The undue portion of assigned
receivables from the distributors which were paid upfront by the Group is classified as “undue assigned
contracted receivables” in trade receivables (Note 19). When monthly installment is invoiced to the subscriber,
related portion is presented as “receivables from subscribers”. The Group collects the contracted receivables
in installments during the contract period and does not recognize any revenue for the handset in these
transactions when the Group does not act as principal for the sale of handset.
Starting from 2016 the Group and distributors started to offer the option to buy a device through consumer
financing loan, which will be collected by Turkcell Finansman. The Group carries a risk of collection in these
transactions. Turkcell Finansman collects the purchased credit from the subscriber during the contract period
and does not record revenue related to the device when it does not act as principal for the sale of device.
Revenue from financial services comprise of interest income generated from consumer financing activities.
Interest income is recognized as it accrues, using the effective interest method.
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F30
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F31
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
(q) Revenue (continued)
(q) Revenue (continued)
Monthly fixed fees represent a fixed amount charged to postpaid subscribers on a monthly basis without regard
to the level of usage. Fixed fees are recognized on a monthly basis when billed. Monthly fixed fees are included
in telecommunication services revenues.
Revenues from the betting business comprise of mainly the net takings earned to a maximum of 1.4% of gross
takings as the head agent of fixed odds betting games and mobile agent revenues of 7.25% of mobile agency
turnover after deducting VAT and gaming tax as the head agent. Revenues from the betting business are
recognized at the time all services related to the games are fully rendered. Under the agreement signed with
Spor Toto Teskilat Mudurlugu A.S. (“Spor Toto”), Inteltek Internet Teknoloji Yatirim ve Danismanlik A.S.
(“Inteltek”) is obliged to undertake any excess payout, which is presented on a net basis.
Azerinteltek QSC (“Azerinteltek”) received authorization from Azeridmanservis Limited Liability Company
set under the Ministry of Youth and Sport of the Republic of Azerbaijan to organize, operate, manage and
develop the fixed odds and paramutual sports betting business. Since Azerinteltek acts as principal, total
consideration received from the player less payout (distribution to players) and amounts collected from players
on behalf of Ministry of Sports is recognized at the time all services related to the games are fully rendered.
Azerinteltek has been authorized for Lottery games by Azerlotereya. Azerinteltek has been generating
commission revenue over Lottery games turnover through its own agencies by applying 15% commission rate
according to the agreement between Azerinteltek and Azerlotereya. Commission revenues are recognized at
the time all services related to the games are fully rendered.
Call center revenues are recognized at the time services are rendered during the contractual period.
When the Group sells goods or services as a principal, revenue and operating costs are recorded on a gross
basis. When the Group sells goods or services as an agent, revenue and operating costs are recorded on a net
basis, representing the net margin earned. Whether the Group is considered to be acting as principal or agent
in the transaction depends on management’s analysis described below and such judgments impact the amount
of reported revenue and operating costs but do not impact reported assets, liabilities or cash flows:
Indicators that an entity is a principal:
The entity is primarily responsible for fulfilling the promise to provide the specified good or service,
The entity has inventory risk before the specified good or service has been transferred to a customer
or after transfer of control to the customer,
The entity has discretion in establishing the price for the specified good or service.
The Company and the Ministry of Transport and Infrastructure of Turkey, Directorate General of
Communications mutually agreed to extend the contract, to establish and operate mobile communication
infrastructure and operation in uncovered areas, until 30 June 2021 and to add mobile broadband services to
the existing infrastructure providing GSM services under Universal Service Law and to operate the new and
existing networks together. As of 31 December 2020, the Company has recognized TL 223,965
(31 December 2019: TL 191,235) revenue from its operations related to this contract. Since the Company acts
as principal, revenue and operating costs are reported on a gross basis in the consolidated financial statements.
The revenue recognition policy for other revenues is to recognize revenue as services are provided.
Contract costs eligible for capitalization as incremental costs of obtaining a contract comprise commission on
sale relating to prepaid and postpaid contracts with acquired or retained subscribers. Contract costs are
capitalized in the month of service activation if the Group expects to recover those costs. Contract costs
comprise sales commissions to dealers and to own salesforce which can be directly attributed to an acquired
or retained contract. Contract costs are classified as intangible assets in the consolidated financial statements.
The asset is amortized on a straight-line basis over the customer lifetime, consistent with the pattern of
recognition of the associated revenue.
(r)
Income taxes
The income tax expense or credit for the period is the tax payable on the current period’s taxable income based
on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences and to unused tax losses.
Income tax expense is recognized in the statement of profit or loss, except to the extent that it relates to items
recognized in other comprehensive income or directly in equity. In this case, the tax is also recognized in other
comprehensive income or directly in equity, respectively.
The current income tax charge is calculated based on the tax laws enacted or substantively enacted at the end
of the reporting period in the countries where the Company’s subsidiaries and associates operate and generate
taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in
which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate based
on amounts expected to be paid to the tax authorities. Deferred income tax is provided in full, using the liability
method, on temporary differences arising between the tax bases of assets and liabilities and their carrying
amounts in the consolidated financial statements. However, deferred tax liabilities are not recognized if they
arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from
initial recognition of an asset or liability in a transaction other than a business combination that at the time of
the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using
tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are
expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is
settled. Deferred tax assets are recognized only if it is probable that future taxable amounts will be available
to utilize those temporary differences and tax losses.
Deferred tax liabilities and assets are not recognized for temporary differences between the carrying amount
and tax bases of investments in foreign operations where the Company is able to control the timing of the
reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable
future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on
a net basis, or to realize the asset and settle the liability simultaneously.
Companies within the Group may be entitled to claim special tax deductions for investments in qualifying
assets or in relation to qualifying expenditure (e.g., the Research and Development Tax Incentive regime in
Turkey or other investment allowances). The Group accounts for such allowances as tax credits, which means
that the allowance reduces income tax payable and current tax expense. A deferred tax asset is recognized for
unclaimed tax credits that are carried forward as deferred tax assets.
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TURKCELL ILETISIM HIZMETLERI AS
F33
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
(s) Earnings per share
(v) Equity
The Group does not have any potential ordinary shares in issue, therefore basic and diluted earnings per share
(“EPS”) are equal. Since basic and diluted EPS are equal, the Group presents both basic and diluted EPS on
one line described as “Basic and diluted EPS”.
Basic EPS is calculated by dividing the profit attributable to ordinary shareholders of the Company by the
weighted-average number of ordinary shares outstanding during the financial year, excluding treasury shares.
In Turkey, entities can increase their share capital by distributing “Bonus share” to shareholders from retained
earnings. In computing earnings per share, such “Bonus share” distributions are treated as issued shares.
Accordingly, the retrospective effect for such share distributions is taken into consideration when determining
the weighted-average number of shares outstanding.
(t) Government grants
Grants from the government are recognized at their fair value where there is a reasonable assurance that the
grant will be received, and the Group will comply with all attached conditions.
Government grants relating to costs are deferred and recognized in profit or loss over the period necessary to
match them with the costs that they are intended to compensate. Government grants relating to property, plant
and equipment are included in non-current liabilities as deferred government grants, and are credited to profit
or loss on a straight-line basis over the expected useful lives of the related assets.
(u) Non-current assets held for sale and discontinued operations
Non-current assets are classified as held for sale if their carrying amount will be recovered principally through
a sale transaction rather than through continuing use, and a sale is considered highly probable. They are
measured at the lower of their carrying amount and fair value less costs of disposal.
An impairment loss is recognized for any initial or subsequent write-down of the asset to fair value less costs
of disposal. A gain is recognized for any subsequent increases in fair value less costs of disposal of an asset,
but not in excess of any cumulative impairment loss previously recognized. A gain or loss not previously
recognized by the date of the sale of the non-current asset is recognized at the date of derecognition.
An associate must meet the conditions to be classified as held for sale. It is first measured in accordance with
applicable standards. Such standard is IAS 28, whereby the share of profits and remeasurement of carrying
amounts are done in accordance with normal associate rules up to the point of classification as held for sale.
The associate is then measured in accordance with IFRS 5. It is measured at the lower of carrying amount and
fair value less costs of disposal. Equity accounting is ceased from the date the held for sale criteria are met.
Non-current assets classified as held for sale are presented separately from the other assets in the statement of
financial position.
A discontinued operation is a component of the entity that has been disposed of or is classified as held for sale
and that represents a separate major line of business or geographical area of operations, is part of a single
coordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired
exclusively with a view to resale. The results of discontinued operations are presented separately in the
statement of profit or loss.
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares
are shown in equity as a deduction, net of tax, from the proceeds.
Where any Group company purchases the Company’s equity instruments, for example as the result of a
share buy-back plan, the consideration paid, including any directly attributable incremental costs (net of
income taxes) is deducted from equity attributable to the owners of the Company as treasury shares until
the shares are cancelled or reissued. Where such ordinary shares are subsequently reissued, any
consideration received, net of any directly attributable incremental transaction costs and the related
income tax effects, is included in equity attributable to the owners of the Company.
(w) Dividends
Provision is made for any dividend declared, being appropriately authorized and no longer at the
discretion of the Company, on or before the end of the reporting period but not distributed at the end of
the reporting period.
(x) Subsequent events
Events after the reporting date; includes all events between the reporting date and the date on which the
financial statements are authorized for issue, even if any announcement of profit or other selected financial
information has been made publicly disclosed.
In case of events requiring correction after the reporting date, the Group corrects this new situation
accordingly. Events that are not required to be adjusted subsequent to the reporting date are disclosed in
the notes to the consolidated financial statements.
(y) Leases
At inception of a contract, the Group assesses whether a contract is, or contains a lease. A contract is, or
contains, a lease if the contract conveys the right to control the use of an identified asset for a period of
time in exchange for consideration. To assess whether a contract conveys the right to control the use of
an identified asset, The Group assesses whether:
- The contract involved the use of an identified asset - this may be specified explicitly or implicitly;
- The asset should be physically distinct or represent substantially all of the capacity of a physically
distinct asset. If the supplier has a substantive substitution right, the asset is not identified;
- The Group has the right to obtain substantially all of the economic benefits from the use of an asset
throughout the period of use and
- The Group has the right to direct use of the asset. The Group has the right when it has the
decision-making rights that are most relevant to changing the how and for what purpose the asset
is used. If these decision are predetermined;
- The Group has the right to operate the asset or,
- The Group designed the asset in a way that predetermines how and for what purpose it is
used.
At inception or on reassessment of a contract that contains a lease component, the Group allocates the
consideration in the contract to each lease component on the basis of their relative stand-alone prices.
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F34
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F35
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
2. Basis of preparation and summary of significant accounting policies (continued)
2. Basis of preparation and summary of significant accounting policies (continued)
(y) Leases (continued)
Right of use asset
(y) Leases (continued)
Lease Liability (continued)
The Group recognizes a right-of use asset and a lease liability at the lease commencement date.
The right of use asset is initially recognized at cost comprising of:
-
-
-
-
Amount of the initial measurement of the lease liability,
Any lease payments made at or before the commencement date, less any lease incentives received,
Any initial direct costs incurred by the Group and
An estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset,
restoring the site on which it is located or restoring the underlying asset to the condition required
by the terms and conditions of the lease, unless those costs are incurred to produce inventories. The
lessee incurs the obligation for those costs either at the commencement date or as a consequence of
having used the underlying asset during a particular period.
The right-of-use asset is subsequently depreciated using the straight-line method from the
commencement date to the earlier of the end date of the useful life of the right-of-use asset or the end
date of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis
as those property and equipment. In addition, the right-of-use asset is periodically reduced by
impairment losses, if any, and adjusted for certain remeasurements of the lease liability (Note 29).
Lease Liability
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, the Group’s incremental borrowing rate. The Group uses its incremental borrowing rate as
the discount rate.
Lease payments included in the measurement of the lease liability comprise the following:
-
-
-
-
Fixed payments, including in-substance fixed payments,
Variable lease payments that depend on an index or a rate, initially measured using the index or
rate as the commencement date,
Amounts expected to be payable under a residual value guarantee and
The exercise price under a purchase option that the Group is reasonably certain to exercise, lease
payments in an optional renewable period if the Group is reasonably certain to exercise an extension
option, and penalties for early termination of a lease if the Group is reasonably certain to terminate
early.
After initial recognition, the lease liability is measured (a) increasing the carrying amount to reflect
interest on lease liability; (b) reducing the carrying amount to reflect the lease payments made, and (c)
remeasuring the carrying amount to reflect any reassessment or lease modifications or to reflect revised
in-substance fixed lease payments.
Where, (a) there is a change in the lease term as a result of reassessment of certainty to exercise an
extension option, or not to exercise a termination option as discussed above; or (b) there is a change in
the assessment of an option to purchase the underlying asset, assessed considering the events and
circumstances in the context of a purchase option, the Group remeasures the lease liabilities to reflect
changes to lease payments by discounting the revised lease payments using a revised discount rate. The
Group determines the revised discount rate as the interest rate implicit in the lease for the remainder of
the lease term, or the its incremental borrowing rate at the date of reassessment, if the interest rate implicit
in the lease cannot be readily determined.
Where, (a) there is a change in the amounts expected to be payable under a residual value guarantee; or
(b) there is a change in the future lease payments resulting from a change in an index or a rate used to
determine those payments, including change to reflect changes in market rental rates following a market
rent review, the Group remeasures the lease liabilities by discounting the revised lease payments using an
unchanged discount rate, unless the change in lease payments results from a change in floating interest
rates. In such case, the Group uses the revised discount rate that reflects changes in the interest rate.
The Group recognizes the amount of the remeasurement of lease liability as an adjustment to the right of
use asset. Where the carrying amount of the right of use asset is reduced zero and there is further reduction
in the measurement of the lease liability, the Group recognizes any remaining amount of the
remeasurement in profit or loss.
The Group accounts for a lease modification as a separate lease if both:
The modification increases the scope of the lease by adding the right to use one or more
-
underlying assets and
-
The consideration for the lease increases by an amount commensurate with the stand-alone price
for the increase in scope and any appropriate adjustments to that stand-alone price to reflect the
circumstances of the particular contract.
The Group as a Lessor
When the Group acts an intermediate lessor, it accounts for its interests in the head lease and the sub-lease
separately. It assesses the lease classification of a sub-lease with reference to the right-of-use-asset arising
from the head lease, not with reference to the underlying asset.
If an arrangement contains lease and non-lease components, the Group applies IFRS 15 to allocate the
consideration in the contract.
(z) New standards and interpretations
i)
Standards, amendments and interpretations applicable as at 31 December 2020
-
-
Amendments to IAS 1 and IAS 8 on the definition of material; effective from Annual periods
beginning on or after 1 January 2020. These amendments to IAS 1, “Presentation of financial
statements”, and IAS 8, “Accounting policies, changes in accounting estimates and errors”, and
consequential amendments to other IFRSs:
Use a consistent definition of materiality throughout IFRSs and the Conceptual Framework
for Financial Reporting,
Clarify the explanation of the definition of material,
Incorporate some of the guidance in IAS 1 about immaterial information.
Amendments to IFRS 3 - definition of a business; effective from Annual periods beginning on
or after 1 January 2020. This amendment revises the definition of a business. According to feedback
received by the IASB, application of the current guidance is commonly thought to be too complex,
and it results in too many transactions qualifying as business combinations.
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F36
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F37
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Basis of preparation and summary of significant accounting policies (continued)
2.
(z) New standards and interpretations (continued)
(z) New standards and interpretations (continued)
i)
Standards, amendments and interpretations applicable as at 31 December 2020 (continued)
-
-
Amendments to IFRS 9, IAS 39 and IFRS 7 - Interest rate benchmark reform; effective from Annual
periods beginning on or after 1 January 2020. These amendments provide certain reliefs in connection with
interest rate benchmark reform. The reliefs relate to hedge accounting and have the effect that IBOR reform
should not generally cause hedge accounting to terminate. However, any hedge ineffectiveness should
continue to be recorded in the income statement. Given the pervasive nature of hedges involving IBOR-
based contracts, the reliefs will affect companies in all industries.
Amendment to IFRS 16, “Leases” - Covid-19 related rent concessions; effective from Annual periods
beginning on or after 1 June 2020. As a result of the coronavirus (COVID-19) pandemic, rent concessions
have been granted to lessees. Such concessions might take a variety of forms, including payment holidays
and deferral of lease payments. On 28 May 2020, the IASB published an amendment to IFRS 16 that
provides an optional practical expedient for lessees from assessing whether a rent concession related to
COVID-19 is a lease modification. Lessees can elect to account for such rent concessions in the same way
as they would if they were not lease modifications. In many cases, this will result in accounting for the
concession as variable lease payments in the period(s) in which the event or condition that triggers the
reduced payment occurs.
ii)
Standards, amendments and interpretations that are issued but not effective as at 31 December 2020
Standards, amendments and interpretations that are issued but not effective as at 31 December 2020
ii)
(continued)
-
-
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Interest Rate Benchmark Reform
Phase 2; effective from Annual periods beginning on or after 1 January 2021. The Phase 2 amendments
address issues that arise from the implementation of the reforms, including the replacement of one
benchmark with an alternative one.
The Group has elected to early adopt the interest rate benchmark reform - Phase 2 as issued in August 2020
which will be effective as of 1 January 2021 and the new rates will be used as of 1 January 2022.
Amendments to IFRS 17 and IFRS 4, “Insurance contracts”, deferral of IFRS 9; effective from annual
periods beginning on or after 1 January 2021. These amendments defer the date of application of IFRS 17
by two years to 1 January 2023 and change the fixed date of the temporary exemption in IFRS 4 from
applying IFRS 9, Financial Instrument until 1 January 2023.
The Group does not expect material impact of new standards and interpretations on the Group’s accounting
policies.
-
-
-
IFRS 17, “Insurance contracts”; effective from annual periods beginning on or after 1 January 2023. This
standard replaces IFRS 4, which currently permits a wide variety of practices in accounting for insurance
contracts. IFRS 17 will fundamentally change the accounting by all entities that issue insurance contracts
and investment contracts with discretionary participation features.
Amendments to IAS 1, “Presentation of financial statements” on classification of liabilities; effective
from 1 January 2022. These narrow-scope amendments to IAS 1, ‘Presentation of financial statements’,
clarify that liabilities are classified as either current or non-current, depending on the rights that exist at the
end of the reporting period. Classification is unaffected by the expectations of the entity or events after the
reporting date (for example, the receipt of a waiver or a breach of covenant). The amendment also clarifies
what IAS 1 means when it refers to the ‘settlement’ of a liability.
A number of narrow-scope amendments to IFRS 3, IAS 16, IAS 37 and some annual improvements
on IFRS 1, IFRS 9, IAS 41 and IFRS 16; effective from Annual periods beginning on or after 1 January
2022.
Amendments to IFRS 3, ‘Business combinations’ update a reference in IFRS 3 to the Conceptual
Framework for Financial Reporting without changing the accounting requirements for business
combinations.
Amendments to IAS 16, ‘Property, plant and equipment’ prohibit a company from deducting from
the cost of property, plant and equipment amounts received from selling items produced while the
company is preparing the asset for its intended use. Instead, a company will recognize such sales
proceeds and related cost in profit or loss.
Amendments to IAS 37, ‘Provisions, contingent liabilities and contingent assets’ specify which
costs a company includes when assessing whether a contract will be loss-making.
Annual improvements make minor amendments to IFRS 1, ‘First-time Adoption of IFRS’,
IFRS 9, ‘Financial instruments’, IAS 41, ‘Agriculture’ and the Illustrative Examples accompanying
IFRS 16, ‘Leases’.
36
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F38
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F39
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Financial risk management
3.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Financial risk management (continued)
3.
This note explains the Group’s exposure to financial risks and how these risks could affect the Group’s future
financial performance. Current year profit and loss information has been included where relevant to add further
context.
The Group’s risk management policies are set to determine and analyze the risks faced, to establish the appropriate
risk limits and to observe the commitment to those limits. These policies are constantly reviewed to make sure
they reflect the Group’s operations and the changes in market conditions.
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices
affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk
management is to manage and control market risk exposures within acceptable parameters, while optimizing the
return on risk. The Group uses derivatives in order to manage market risks. All such transactions are carried at within
the guidelines set by the Group Treasury.
Credit risk
(i)
Foreign exchange risk
At the reporting date, there were no significant concentrations of credit risk. The maximum exposure to credit
risk is represented by the carrying amount of cash and cash equivalents, financial asset at fair value through other
comprehensive income, financial asset at amortize cost, derivative financial instruments, contract assets, trade
receivables, receivables from financial services, due from related parties and other current and non-current assets
(Note 36).
Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. The
Group may require collateral in respect of financial assets. Also, the Group may demand letters of guarantee from
third parties related to certain projects or contracts. The Group may also demand certain pledges from
counterparties if necessary, in return for the credit support it gives related to certain financings (Note 19).
In monitoring customer credit risk, customers are grouped according to whether they are subscribers, financial
services customers, other corporate customers and aging profile, maturity and existence of previous financial
difficulties. Trade receivables and contract assets are mainly related to the Group’s subscribers. The Group’s
exposure to credit risk on trade receivables and contract assets is influenced mainly by the individual payment
characteristics of postpaid subscribers. The Group establishes an allowance for impairment that represents its
estimate of incurred losses in respect of trade receivables and contract assets. This allowance comprises the
general provision which is determined based on a loss event.
Investments are preferred to be in liquid securities. The counterparty limits are set monthly depending on their
ratings from the most credible rating agencies and the amount of their paid-in capital and/or shareholders equity.
Policies are in place to review the paid-in capital and rating of counterparties periodically to ensure credit
worthiness.
The Group signs local and international derivate agreements in order to be able to execute financial derivative
transactions with financial institutions that are believed to have sufficient credit ratings.
The Group’s policy is to provide financial guarantees only to subsidiaries and distributors. At 31 December 2020,
guarantees of TL 2,171,281 were outstanding (31 December 2019: TL 3,323,318).
Liquidity risk
the end of
Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding through an
adequate amount of committed credit facilities to meet obligations when due and to close out market positions.
At
the Group held demand deposits of TL 975,753
(31 December 2019: TL 632,022) that are expected to readily generate cash inflows for managing liquidity risk.
Due to the dynamic nature of the underlying businesses, the Group Treasury maintains flexibility in funding by
maintaining availability under committed credit lines.
reporting period
the
Management monitors rolling forecasts of the Group’s liquidity reserve (Note 36) and cash and cash equivalents
(Note 24) on the basis of expected cash flows. In addition, the Group’s liquidity management policy involves
projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these,
monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining
debt financing plans.
The Group operates internationally and is exposed to foreign exchange risk arising from foreign currency
transactions, primarily with respect to the USD, EUR and RMB. Foreign exchange risk arises from recognized assets
and liabilities denominated in a currency that is not the functional currency of the relevant Group entity. The Group
holds a significant portion of its cash and cash equivalent in foreign currencies in order to manage foreign exchange
risk. In addition, derivative financial instruments are used to manage exposure to fluctuations in foreign exchange
rates and since 1 July 2018 the Company applies hedge accounting. Details of the Company’s foreign exchange risk
is disclosed in Note 36.
(ii)
Interest rate risk
The Group’s exposure to interest rate risk is related to its financial assets and liabilities. The Group manage its
financial liabilities by providing an appropriate distribution between fixed and floating rate loans. Floating rate
exposures can be changed to fixed rate exposures based on short term and long term market expectations via
financial derivatives. The use of financial derivatives is governed by the Group Treasury’s policies approved by the
Audit Committee, which provide written principles on the use of derivatives. The Group’s borrowings and
receivables are carried at amortized cost. The borrowings are periodically contractually repriced (Note 36) and are
also exposed to the risk of future changes in market interest rates.
Effect of IBOR reform
Following the financial crisis, the reform and replacement of benchmark interest rates such as USD LIBOR and
other interbank offered rates (‘IBORs’) has become a priority for global regulators. There are ongoing studies for
these changes. The Group’s risk exposure that is directly affected by the interest rate benchmark reform is its
USD 367,787 floating-rate debt. The Group has hedged this debt with participating cross currency, cross currency
and interest swaps, and it has designated at participating cross currency swap in a cash flow hedge of the variability
in cash flows of the debt, due to changes in 6-month USD LIBOR that is the current benchmark interest rate after
the publication of Phase-2 in August 2020. The nominal amount of these derivative instruments is USD 431,359
and the nominal amount of the hedged part of these instruments is USD 276,069.
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The Group treasury department oversees the Group’s USD LIBOR transition plan. This transition project will
include changes to systems, processes, risk and valuation models, as well as managing related tax and accounting
implications. The Group currently anticipates that the areas of greatest change will be amendments to the contractual
terms of the USD LIBOR-referenced floating-rate debt and the participating cross currency swap and updating hedge
designations.
Effect of IBOR reform – significant assumptions
In calculating the change in fair value attributable to the hedged risk of the floating-rate debt, the Group has made
the following assumptions that reflect its current expectations:
- The floating-rate debt will move to an alternative benchmark rate during 2022, and the spread will be similar to
the spread included in the participating cross currency swap used as the hedging instrument;
- No other changes to the terms of the floating-rate debt are anticipated; and
- The Group has incorporated the uncertainty over when the floating-rate debt will move to an alternative benchmark
rate, the resulting adjustment to the spread, and the other aspects of the reform that have not yet been finalized by
adding an additional spread to the discount rate used in the calculation.
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F40
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest thousand
currency units and are expressed in Turkish Liras unless otherwise stated.)
Segment information
4.
The Group has two reportable segments in accordance with its integrated communication and technology services
strategy - Turkcell Turkey and Turkcell International. While some of these strategic segments offer the same types
of services, they are managed separately because they operate in different geographical locations and are affected
by different economic conditions.
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker. The chief operating decision maker function is carried out by the Board of Directors, however
Board of Directors may transfer the authorities, other than recognized by the law, to the CEO and other directors.
Turkcell Turkey reportable segment includes the operations of Turkcell, Turkcell Superonline Iletisim Hizmetleri
A.S. (“Turkcell Superonline”), Turkcell Satis ve Dijital Is Servisleri Hizmetleri A.S. (“Turkcell Satis”), group call
center operations of Global Bilgi Pazarlama Danismanlik ve Cagri Servisi Hizmetleri A.S. (“Turkcell Global
Bilgi”), Turktell Bilisim Servisleri A.S. (“Turktell”), Turkcell Teknoloji Arastirma ve Gelistirme A.S. (“Turkcell
Teknoloji”), Kule Hizmet ve Isletmecilik A.S. (“Global Tower”), Rehberlik Hizmetleri Servisi A.S.
(“Rehberlik”), Turkcell Gayrimenkul Hizmetleri A.S. (“Turkcell Gayrimenkul”), Lifecell Dijital Servisler ve
Cozumler A.S. (“Lifecell Dijital Servisler”), Lifecell Bulut Cozumleri A.S. (“Lifecell Bulut”), Lifecell TV Yayin
ve Icerik Hizmetleri A.S. (“Lifecell TV”), Lifecell Muzik Yayin ve Iletim A.S. (“Lifecell Muzik”) and BiP
Iletisim Teknolojileri ve Dijital Servisler Anonim Sirketi (“BiP Iletisim”). Turkcell International reportable
segment includes the operations of Kibris Mobile Telekomunikasyon Limited Sirketi (“Kibris Telekom”), East
Asian Consortium B.V. (“Eastasia”), Lifecell LLC (“lifecell”), Lifecell Ventures Cooperatief U.A (“Lifecell
Ventures”), Beltel Telekomunikasyon Hizmetleri A.S. (“Beltel”), CJSC Belarusian Telecommunications Network
(“Belarusian Telecom”), LLC UkrTower (“UkrTower”), LLC Global Bilgi (“Global LLC”), Turkcell Europe
GmbH (“Turkcell Europe”), Lifetech LLC (“Lifetech”), Beltower LLC (“Beltower”), Lifecell Digital Limited
(“Lifecell Digital”), Yaani Digital BV (“Yaani”) and BiP Digital Communication Technologies B.V (“BiP
Digital”). The operations of these legal entities aggregated into one reportable segment as the nature of services
are similar and most of them share similar economic characteristics. Other reportable segment mainly comprises
the non-group call center operations of Turkcell Global Bilgi and the operations of Turkcell Finansman, Turkcell
Odeme Hizmetleri A.S. (“Turkcell Odeme”), Turkcell Enerji Cozumleri ve Elektrik Satis Ticaret A.S (“Turkcell
Enerji”), Paycell LLC and Turkcell Sigorta Aracilik Hizmetleri A.S (“Turkcell Sigorta”).
The Board primarily uses adjusted EBITDA to assess the performance of the operating segments. Adjusted
EBITDA definition includes revenue, cost of revenue excluding depreciation and amortization, selling and
marketing expenses and administrative expenses.
Adjusted EBITDA is not a financial measure defined by IFRS as a measurement of financial performance and
may not be comparable to other similarly titled indicators used by other companies. Reconciliation of Adjusted
EBITDA to the consolidated profit for the year is included in the accompanying notes.
According to the resolution of the General Assembly dated 6 July 2020, the trade name of Turkcell Ozel
Finansman A.S. (“TOFAS”) was changed to Lifecell Iletisim Teknolojileri ve Dijital Servisler A.S. (“Lifecell
Iletisim”) and its business activity is determined and announced as providing digital services and products as of
21 July 2020. The trade name of Lifecell Iletisim was changed to BiP Iletisim on 14 December 2020. BiP Iletisim
has started its operations relating to providing digital services and products as of October 2020, and its operations
are reported in Turkcell Turkey reportable segment.
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
336
F42
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Segment information (continued)
4.
Profit for the period
Add(Less):
(Profit)/loss from discontinued
operations
Profit from continuing operations
Income tax expense
Finance income
Finance costs
Other income
Other expenses
Depreciation and amortization
Share of loss of equity accounted
investees
Consolidated adjusted EBITDA
Geographical information
2020
2019
2018
4,239,620
3,276,690
2,177,335
-
(772,436)
-
4,239,620
387,193
(2,119,483)
3,251,164
(96,585)
619,835
5,974,779
13,775
12,270,298
2,504,254
785,630
(297,450)
2,025,118
(140,705)
487,295
5,046,565
15,712
10,426,419
2,177,335
495,481
(1,677,114)
3,364,072
(241,435)
381,582
4,287,974
87
8,787,982
In presenting the information based on geographical segments, segment revenue is based on the
geographical location of operations and segment assets are based on the geographical location of the
assets.
Revenues
Turkey
Ukraine
Belarus
Turkish Republic of Northern Cyprus
Netherlands
Germany
Azerbaijan
Non-current assets
Turkey
Ukraine
Belarus
Turkish Republic of Northern Cyprus
Unallocated non-current assets
2020
2019
2018
26,648,183
1,800,983
395,363
229,652
28,863
694
-
29,103,738
23,229,046
1,322,116
366,314
209,109
8,396
2,154
-
25,137,135
19,636,682
923,181
293,181
169,014
366
1,580
268,471
21,292,475
31 December
2020
26,165,209
3,390,246
264,864
244,710
849,992
30,915,021
31 December
2019
22,737,468
3,030,095
219,281
198,732
197,255
26,382,831
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F43
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
338
F44
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F45
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Revenue (continued)
5.
Telecommunication services
At a point in time
Over time
Equipment revenues
At a point in time
Over time
Revenue from financial services
At a point in time
Over time
Call center revenues
At a point in time
Over time
All other
At a point in time
Over time
Total
At a point in time
Over time
Turkcell
Turkey
21,676,330
254,619
21,421,711
3,194,083
3,105,851
88,232
-
-
-
25,397
-
25,397
264,430
48,626
215,804
25,160,240
3,409,096
21,751,144
2020
Turkcell
International
Other
2,299,682
14,821
2,284,861
122,901
122,901
-
-
-
-
34,566
-
34,566
85,261
9,132
76,129
2,542,410
146,854
2,395,556
-
-
-
-
-
-
845,189
245,223
599,966
415,366
-
415,366
813,071
-
813,071
2,073,626
245,223
1,828,403
Intersegment
eliminations
(58,507)
-
(58,507)
-
-
-
(14,202)
(14,202)
-
(43,358)
-
(43,358)
(556,471)
-
(556,471)
(672,538)
(14,202)
(658,336)
Consolidated
23,917,505
269,440
23,648,065
3,316,984
3,228,752
88,232
830,987
231,021
599,966
431,971
-
431,971
606,291
57,758
548,533
29,103,738
3,786,971
25,316,767
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Revenue (continued)
5.
2019
Turkcell
International
Other
Intersegment
eliminations
Consolidated
Telecommunication services
At a point in time
Over time
Equipment revenues
At a point in time
Over time
Revenue from financial services
At a point in time
Over time
Call center revenues
At a point in time
Over time
Commission fees on betting business
At a point in time
Over time
All other
At a point in time
Over time
Total
At a point in time
Over time
Turkcell
Turkey
19,157,657
198,734
18,958,923
2,130,135
2,050,055
80,080
-
-
-
1,780,793
10,555
1,770,238
115,905
115,905
-
-
-
-
21,851
-
21,851
17,008
-
17,008
-
-
-
-
-
-
177,513
37,726
139,787
21,487,156
2,286,515
19,200,641
89,083
19,300
69,783
2,002,789
145,760
1,857,029
-
-
-
-
-
-
1,141,712
222,930
918,782
308,126
-
308,126
132,300
-
132,300
635,841
2,306
633,535
2,217,979
225,236
1,992,743
(60,147)
-
(60,147)
-
-
-
(839)
(839)
-
(34,542)
-
(34,542)
-
-
-
(475,261)
(657)
(474,604)
(570,789)
(1,496)
(569,293)
20,878,303
209,289
20,669,014
2,246,040
2,165,960
80,080
1,140,873
222,091
918,782
312,443
-
312,443
132,300
-
132,300
427,176
58,675
368,501
25,137,135
2,656,015
22,481,120
6. Other income and expense
Recognized in the statement of profit or loss:
Gain on sale of fixed assets
Gain on modification of lease contract
Non-interest income from banks
Rent income
Gain on sale of investments
Other
Other income
Litigation expenses
Donation expenses
Supplementary contributions to retailers
Subscriber returns
Restructuring cost
Other
Other expense
2020
23,950
13,840
12,245
8,839
-
37,711
96,585
(387,352)
(60,778)
(46,804)
(22,722)
(13,051)
(89,128)
(619,835)
2019
47,169
1,484
2,477
6,522
-
83,053
140,705
(303,879)
-
-
-
(91,710)
(91,706)
(487,295)
2018
43,727
-
5,996
4,637
110,308
76,767
241,435
(87,099)
(176,321)
-
-
(9,840)
(108,322)
(381,582)
44
45
339
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
340
F46
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F47
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Employee benefit expenses
7.
Wages and salaries (*)
Employee termination benefits (**)
Defined contribution plans
2020
2,820,500
38,879
14,677
2,874,056
2019
2,434,790
31,799
12,785
2,479,374
2018
1,968,882
29,140
9,361
2,007,383
(*) Wages and salaries include compulsory social security contributions, bonuses and share based payments.
(**) Remeasurements of employee termination benefits for the years ended 31 December 2020, 2019 and 2018 amounting to
TL 37,230, TL 36,385 and TL (12,699) respectively are reflected in other comprehensive income.
Employee benefit expenses are recognized in cost of revenue, selling and marketing expenses and administrative expenses.
8.
Finance income and costs
Recognized in the statement of profit or loss:
Cash flow hedges - reclassified to profit or loss
Net fair value gains and interest on derivative
financial instruments
Interest income
Other
Finance income
Net foreign exchange losses
Net interest expenses for financial assets and
liabilities measured at amortized cost
Net fair value losses and interest on derivative
financial instruments
Cash flow hedges - reclassified to profit or loss
Other
Finance costs
Net finance costs
2020
1,410,997
317,820
366,695
23,971
2,119,483
2019
-
-
288,010
9,440
297,450
2018
568,370
654,933
395,045
58,766
1,677,114
(2,409,550)
(1,039,618)
(2,695,045)
(811,439)
(874,535)
(552,101)
-
-
(30,175)
(3,251,164)
(1,131,681)
(550,438)
461,133
(21,660)
(2,025,118)
(1,727,668)
-
-
(116,926)
(3,364,072)
(1,686,958)
Net foreign exchange losses mainly include foreign exchange losses on borrowings, bonds issued and
cash and cash equivalents.
Foreign exchange losses from Belarusian Telecom and lifecell exclude foreign exchange losses incurred
in the foreign operations’ individual financial statements, which have been recognized directly in equity
under foreign currency translation reserve in the consolidated financial statements in accordance with the
accounting policy for net investment in foreign operations as disclosed in Note 2c.
Interest income and expense on financial assets measured at amortized cost are shown netted of on
consolidated statement of profit or loss. The Company has gross interest income and expense on financial
assets at amortized cost amounting to TL 281,993, TL (1,093,432), TL 316,932, TL (1,191,467), and
TL 255,019, TL (807,120) for the years ended 31 December 2020, 2019 and 2018, respectively.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Income tax expense
9.
2020
2019
2018
Current income tax expense
Deferred income tax credit/(expense)
Total income tax expense
(724,688)
337,495
(387,193)
(570,509)
(215,121)
(785,630)
(654,953)
159,472
(495,481)
Income tax expense is attributable to profit from continuing operations.
Income tax relating to each component of
other comprehensive income
2020
Foreign currency translation differences
Change in cash flow hedge reserve
Change in cost of hedging reserve
Fair value reserve
Hedges of net investments in foreign
operations
Remeasurements of employee termination
benefits
2019
Foreign currency translation differences
Change in cash flow hedge reserve
Change in cost of hedging reserve
Fair value reserve
Hedges of net investments in foreign
operations
Remeasurements of employee termination
benefits
2018
Foreign currency translation differences
Change in cash flow hedge reserve
Change in cost of hedging reserve
Remeasurements of employee termination
benefits
Before tax
29,352
9,914
(487,644)
(1,970)
Tax (expense)/
credit
7,729
(5,957)
92,089
483
Net of tax
37,081
3,957
(395,555)
(1,487)
(368,959)
72,684
(296,275)
(37,230)
(856,537)
6,085
173,113
(31,145)
(683,424)
536,796
(217,877)
75,605
4,451
(55,389)
(36,385)
307,201
850,188
19,156
(347,602)
12,699
534,441
(99,234)
47,933
(16,634)
(979)
437,562
(169,944)
58,971
3,472
12,186
(43,203)
8,005
(48,723)
(28,380)
258,478
(226,667)
(4,214)
76,472
(2,794)
(157,203)
623,521
14,942
(271,130)
9,905
377,238
46
47
341
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
342
F48
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F49
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Income tax expense (continued)
9.
Reconciliation of income tax expense
Profit from continuing operations before income tax
expense
(Loss) from discontinued operations before income tax
expense
Profit before income tax expense
2020
2019
2018
4,626,813
3,289,884
2,672,816
-
4,626,813
772,436
4,062,320
-
2,672,816
-
-
(588,020)
7,617
198,160
-
-
(123,738)
(1,017,899)
665,842
6,746
(893,710)
(12,580)
123,878
(3,825)
130,718
Tax at the Turkey’s tax rate
Difference in overseas tax rates
Effect of exemptions (*)
Previously unrecognized tax losses used to reduce
deferred tax expense (**)
Utilization of previously unrecognized tax losses
Effect of amounts which are not deductible and
permanent differences
Tax exemptions from sale of subsidiary and associate
(***)
Change in unrecognized deferred tax assets (****)
Adjustments for current tax of prior years
Tax effect of investment in associate and joint venture
Other
Total income tax expense
(*) Mainly comprises of research and development tax credit exemption. For the year ended 31 December 2018, includes the
exemption effect of sales of Fintur amounted to TL 76,164.
(**) Mainly comprises the deferred tax credit of TL 665,842 which relates to the carried-forward tax losses of lifecell. lifecell
has recorded positive taxable profits for the year ended 31 December 2020, mainly as a result of increased subscriber numbers
and cost management. The Group has concluded that the deferred tax assets will be recoverable using the estimated future taxable
profits based on the business plan of lifecell. The tax losses can be carried forward indefinitely and have no expiry date.
(***) For the years ended 31 December 2019 and 2018, includes the Group’s transfer of its total shareholding in Fintur and
Azerinteltek, respectively (Note 39).
(****) Mainly comprises of unused tax losses for which no deferred tax asset has been recognized.
169,936
(41,681)
3,880
(2,592)
1,777
(785,630)
-
(47,094)
3,452
(2,794)
1,399
(387,193)
(134,538)
(91,778)
24,268
(50,551)
2,510
-
2,313
(495,481)
The Turkish entities within the Group are subject to corporate tax at the rate of 20%. Corporate tax is
applied on taxable corporate income, which is calculated from the statutory accounting profit by adding
back non-deductible expenses, and by deducting tax exempt income. On 5 December 2017, Turkey’s Law
No. 7061 on the Amendment of Certain Tax Laws and Some Other Laws, and which was adopted on
28 November 2017, was published in the Official Gazette. The Law increases the corporate tax rate under
Corporate Tax Law, No. 5520, from the current 20% rate to 22% for tax years 2018, 2019, and 2020; the
change took effect on the Law’s date of publication. The corporate tax rate decreases to 20% in 2021.
In Turkey, there is no procedure for a final and definitive agreement on tax assessments. Companies file
their tax returns by the end of the fourth month following the closing of the accounting year to which they
relate. Corporate tax payment is made by the end of the month in which the tax return is filed. The tax
authorities may, however, examine such returns and the underlying accounting records, and may revise
assessments within a five-year period. Advance tax returns are filed on a quarterly basis.
In Turkey, the transfer pricing provisions have been stated under Article 13 of Corporate Tax Law with
the heading of “disguised profit distribution via transfer pricing”. The General Communiqué on disguised
profit distribution via Transfer Pricing, dated 18 November 2007 sets out the details of implementation.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Income tax expense (continued)
9.
If a taxpayer enters into transactions regarding the sale or purchase of goods and services with related
parties, where the prices are not set in accordance with arm's length principle, then related profits are
considered to be distributed in a disguised manner through transfer pricing. Such disguised profit
distributions through transfer pricing are not accepted as tax deductible for corporate income tax
purposes.
The deduction of 100% of the research and development expenses is allowed when the taxpayers are
made these expenditures exclusively for new technology and information researches.
Dividend payments of Turkish resident corporations to Turkish real persons, foreign corporations and
foreign real persons are subject to 15% withholding tax. It is possible to apply reduced withholding tax
rate for dividend payments made to abroad, under the scope of provisions of an applicable double taxation
treaty. On the other hand, dividend payments made to Turkish resident companies are not subject to
withholding tax.
Dividend income of Turkish taxpayers received from other Turkish taxpayers is exempted from corporate
tax. However, dividends received from participation shares and stocks of fund and investment
partnerships cannot utilize from this exemption.
75% of the profits arising from the sale of affiliate shares, founders' shares, redeemed shares and
preemptive rights that are held by the corporations for at least two years are exempted from corporate tax.
However, as of 5 December 2017, the date of the publication of the Law No. 7061, 50% of the profits
arising from the sale of immovable properties included in the assets of corporations for two years are
exempted from corporate tax. The exemption rate had been 75% prior to this date. In order to benefit from
these exemptions, profits must be recorded under a passive fund account on the balance sheet and not
withdrawn for 5 years. Also, the sale amounts must be received until the end of the second calendar year
following the sale.
Pursuant to Article 10/13-h of Law No.7143 published in the Official Gazette dated 18 May 2018 and
numbered 30425;
For the resident real persons and institutions,
-
Income from the sale of non-resident subsidiary shares,
- Participation income from non-resident subsidiaries,
- Commercial income through permanent establishment and permanent representatives abroad,
including those obtained until the date 31 October 2018, are exempted from income tax or corporation
the effective date of Article until
tax under condition that incomes are transferred from
31 December 2018. In accordance with the Presidential Decree dated 29 August 2018 and numbered 48,
the terms of the Article have been extended for 6 months. In this way, including those obtained until the
date 30 April 2019, income from the sale of non-resident subsidiary’s shares are exempted from
corporation tax under condition that incomes are transferred until 30 June 2019.
For the resident real persons and institutions, income from the liquidation of non-resident
institutions are exempt from income tax or corporation tax under condition that incomes are transferred
to Turkey until the date 31 December 2018. In accordance with the President Decision dated
29 August 2018 and numbered 48, the terms of the Article have been extended for 6 months. In this way,
income from the liquidation of non-resident institutions are exempted from corporation tax under
condition that incomes are transferred until 30 June 2019.
48
49
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
344
F50
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F51
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
10. Expenses by nature
10. Expenses by nature (continued)
Breakdown of expenses by nature for the years ended 31 December 2020, 2019 and 2018 is as follows:
Administrative expenses:
Cost of revenue:
Depreciation and amortization (*)
Cost of goods sold
Treasury share
Interconnection and termination expenses
Employee benefit expenses
Radio expenses
Frequency expenses
Transmission expenses
Universal service fund
Roaming expenses
Cost of revenue from financial services (**)
Others
2020
(5,974,779)
(3,301,984)
(2,418,800)
(2,247,647)
(1,741,591)
(921,153)
(887,243)
(426,036)
(330,932)
(214,478)
(135,237)
(1,736,179)
(20,336,059)
2019
(5,046,565)
(2,278,283)
(2,191,427)
(1,909,614)
(1,447,037)
(734,583)
(802,950)
(335,980)
(297,053)
(238,147)
(240,297)
(1,561,544)
(17,083,480)
2018
(4,287,974)
(1,284,180)
(1,884,556)
(1,763,414)
(1,148,445)
(508,884)
(622,390)
(326,080)
(256,454)
(226,806)
(378,477)
(1,458,333)
(14,145,993)
(*) As at 31 December 2020, depreciation and amortization expenses include depreciation and amortization expenses related to
the financial services amounting to TL 39,726 (31 December 2019: TL 26,478; 31 December 2018: TL 16,321).
(**) As at 31 December 2020, cost of revenue from financial services includes employee benefit expenses related to the financial
services amounting to TL 18,166 (31 December 2019: TL 11,358; 31 December 2018: TL 8,532).
Selling and marketing expenses:
Employee benefit expenses
Marketing expenses
Selling expenses
Others
2020
(634,367)
(507,921)
(173,064)
(57,601)
(1,372,953)
2019
(547,136)
(554,538)
(349,269)
(104,246)
(1,555,189)
2018
(433,997)
(551,127)
(555,158)
(86,432)
(1,626,714)
Employee benefit expenses
Service expenses
Consultancy expenses
Collection expenses
Maintenance and repair expenses
Travel and entertainment expenses
Other
2020
(479,932)
(58,255)
(53,105)
(52,189)
(20,139)
(17,009)
(68,983)
(749,612)
2019
(473,843)
(52,756)
(51,308)
(57,097)
(26,610)
(34,644)
(83,497)
(779,755)
2018
(416,409)
(35,257)
(38,252)
(37,525)
(26,867)
(38,406)
(80,654)
(673,370)
Net impairment losses on financial and contract assets:
Net impairment losses on financial and
contract assets
2020
2019
2018
(349,595)
(349,595)
(338,857)
(338,857)
(346,390)
(346,390)
50
51
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
346
F52
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
348
F54
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Intangible assets
12.
Turkcell
The carrying amounts of 2G, 3G and 4.5G licenses are TL 103,460, TL 320,599 and TL 3,320,721,
respectively (31 December 2019: TL 149,443, TL 359,071 and TL 3,723,232, respectively).
lifecell
lifecell owns nine activity licenses: a technology neutral license, issued for 3G, one license for
international and long-distance calls and seven PSTN licenses for seven regions in Ukraine. As of 31
December 2020, lifecell owns twenty frequency use licenses for IMT (LTE-2600, LTE-1800, LTE-900),
IMT-2000 (UMTS), GSM-900, GSM-1800, and microwave Radiorelay and Broadband Radio Access,
which are regional and national. Additionally, lifecell holds a specific number range — three NDC codes
for mobile network, twenty-eight permissions on a number resource for short numbers, ten permissions
on a number resource for SS-7 codes (six regional and four international), one permission on a number
resource for Mobile Network Code, eight permissions on a number resource for local ranges for PSTN
licenses, two permissions on service codes for alternative routing selection for international and long-
distance fixed telephony, and one permission on a code for global telecommunication service “800”. The
carrying amount of lifecell’s licenses is TL 1,217,173 (31 December 2019: TL 1,254,713).
54
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
350
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TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
12.
Intangible assets (continued)
Amortization expenses for the years ended 31 December 2020, 2019 and 2018 amounting to
TL 2,454,969, TL 1,920,756 and TL 1,580,319, respectively include impairment losses and are recognized
ended
in
31 December 2020, 2019 and 2018 are TL 18,460, TL 2,540 and TL 3,232, respectively and are
recognized in amortization expenses.
Impairment
losses on
the years
intangible
cost of
revenue.
assets
for
Computer software includes capitalized software development costs that meet the definition of an
intangible asset. The amount of capitalized development costs is TL 244,204 for the year ended
31 December 2020 (31 December 2019: TL 206,064). The amortization expenses related to capitalized
software development costs for the years ended 31 December 2020, 2019 and 2018 amounting to
TL 46,601, TL 47,591 and TL 40,934, respectively are recognized in cost of revenue.
13.
Impairment of assets
The Group’s cash-generating units (CGUs) are reviewed at each reporting date to determine whether there
is any indication of impairment. If any such indication exists, then the recoverable amount of the CGU is
estimated. The recoverable amount of the CGU is its fair value less cost of disposal. At
31 December 2020, no impairment test has been carried out since there was no indication of impairment
in any of the Group’s CGUs.
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Addition
Disposal
Transfer to property, plant and equipment
Closing balance
Accumulated depreciation
Opening balance
Transfer to property, plant and equipment
Depreciation and impairment charges during the year
Disposal
Closing balance
31 December
2020
31 December
2019
46,283
-
(15,985)
6,781
37,079
(30,000)
(5,528)
(697)
12,821
(23,404)
145,759
987
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(100,463)
46,283
(130,334)
103,262
(2,928)
-
(30,000)
Net book amount
13,675
16,283
Determination of the fair values of the Group’s investment properties
The Group engages qualified external experts, authorized by the Capital Markets Board of Turkey, to
perform the valuation of investment properties. Management works closely with the qualified external
experts to establish the appropriate valuation techniques and inputs to the model. The fair values of these
investment properties were determined using a variety of valuation methods: income capitalization
approach and market approach. In estimating the fair values of the properties, the highest and best use of
the property is its current use.
Rent income from investment properties during the year ended 31 December 2020 is TL 5,855
(31 December 2019: TL 4,078 and 31 December 2018: TL 3,092). There is TL 294 direct operating
expense for investment properties during the year ended 31 December 2020 (31 December 2019: TL 522
and 31 December 2018: None).
57
F57
351
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
352
F58
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
Investment properties (continued)
14.
The Group’s investment properties and their fair values at 31 December 2020 and 2019 are as follows:
31 December 2020
Level 1
Level 2
Level 3
Valuation Method
Investment properties in Gebze
Investment properties in Ankara
Investment properties in Aydin
-
-
-
-
-
22,340
15,160
2,515
17,675
-
-
22,340
Income capitalization
approach
Market approach
Market approach
31 December 2019
Level 1
Level 2
Level 3
Valuation Method
Investment properties in Gebze
Investment properties in Ankara
Investment properties in Istanbul
-
-
-
-
-
21,520
14,400
14,585
28,985
-
-
21,520
Income capitalization
approach
Market approach
Market approach
Significant unobservable inputs and sensitivity of fair values of respective investment properties are as
follows:
In the “income capitalization” approach, a significant increase/(decrease) in rentals will cause a significant
increase/(decrease) in the fair value. In addition, a slight decrease/(increase) in risk premium and discount
rate which are calculated by considering current market conditions will cause a significant
increase/(decrease) in the fair value.
In the “market approach”, a significant increase/(decrease) in the market value of any properties which
are located in similar areas with similar conditions will cause a significant increase/(decrease) in the fair
value.
58
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
354
F60
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
F61
355
16. Discontinued operations
Disposal of Fintur
In 2016, the Group has committed to the plan to exit from Fintur operations in relevant jurisdictions and
initiated an active program to locate a buyer for its associate. In this regard, Fintur has been classified as
held for sale and reported as discontinued operation starting from 1 October 2016.
Equity accounting for Fintur ceased as of 1 October 2016, and in accordance with IFRS 5, Fintur
has been measured at the lower of the carrying amount and fair value less costs to sell.
The Company signed the definitive agreement on 12 December 2018 to transfer its total shareholding in
Fintur to the other shareholder of Fintur, Sonera Holding B.V. (“Sonera Holding”). The transfer to Sonera
Holding and the transfer of proceeds completed on 2 April 2019 subsequent to receipt of regulatory
is realized as TL 2,229,595
approvals on 29 March 2019. The final
(EUR 352,851). The share transfer has been completed in 2019, gain on sale of the associate, amounting
to TL 772,436 has been recognized under profit from discontinued operations in the consolidated financial
statements.
transaction value
Reconciliation of Fintur sales for the period ended 31 December 2019 is stated as below:
Consideration received or receivable:
Cash
Total disposal consideration
Carrying amount of net assets sold
Gain on sale before income tax and reclassification of foreign currency
translation reserve
Reclassification of foreign currency translation reserve
Income tax expense on gain
Gain on sale after income tax
31 December 2019
2,229,595
2,229,595
(1,825,292)
404,303
368,133
-
772,436
Subsequent to recognition of gain on sale of Fintur for the three months period ended 31 March 2019, the
Company has recognized compensation expense, which has been paid on 23 July 2019 according to Kcell
Share Purchase Agreement amounting to TL 59,224 (USD 10,448).
17. Other non-current assets
Advances given for property, plant and equipment
Prepaid expenses
Deposits and guarantees given
Receivables from the Public Administration
VAT receivable
Others
2020
561,298
141,201
78,401
72,848
29,025
1,069
883,842
2019
59,959
133,914
34,602
72,848
1,902
1,045
304,270
18. Deferred tax assets and liabilities
Recognized deferred tax assets and liabilities
Deferred tax assets and liabilities at 31 December 2020 and 2019 are attributable to the following:
Property, plant and equipment
and intangible assets
Investment
Derivative instruments
Reserve for employee
termination benefits and
provisions
Trade and other payables
Tax losses carried forward
Tax allowances
Other assets and liabilities (*)
Deferred tax
assets/(liabilities)
Offsetting
Net deferred tax
assets/(liabilities)
Assets
Liabilities
Net
2020
2019
2020
2019
2020
2019
123,871
-
27,177
145,242
32,926
24,303
(2,117,594)
-
(407,740)
(1,915,567)
-
(349,797)
(1,993,723)
-
(380,563)
(1,770,325)
32,926
(325,494)
258,675
26,511
1,101,043
5,158
638,991
167,589
81,558
258,040
59,176
586,769
(1,362)
(149,827)
(3,254)
-
(2,872)
(36,289)
(14,823)
-
-
(15,415)
257,313
(123,316)
1,097,789
5,158
636,119
131,300
66,735
258,040
59,176
571,354
2,181,426
(1,344,818)
1,355,603
(1,166,261)
(2,682,649)
1,344,818
(2,331,891)
1,166,261
(501,223)
-
(976,288)
-
836,608
189,342
(1,337,831)
(1,165,630)
(501,223)
(976,288)
(*) Mainly comprises of loans, bonds, prepaid expenses and lease liabilities deferred tax assets.
Movement in deferred tax assets/ (liabilities) for the years ended 31 December 2020 and 2019 were as follows:
Opening balance
Income statement charge
Tax charge relating to components of other comprehensive income
Exchange differences
Closing balance, net
2020
2019
(976,288)
337,495
173,113
(35,543)
(501,223)
(709,628)
(215,121)
(48,723)
(2,816)
(976,288)
The Group did not recognize deferred income tax assets of TL 551,847 (31 December 2019: TL 1,199,670) in
respect of tax losses amounting to TL 2,986,951 (31 December 2019: TL 6,588,723) that can be carried forward
against future taxable income. The unused tax losses were incurred mainly by Belarusian Telecom that are not
likely to generate taxable income in the foreseeable future.
Unused tax losses will expire at the following dates:
Expiration Date
2021
2022
2023
2024
2025
2026
2027
2028
Indefinite
Total
Amount
212,836
136,298
201,770
345,681
1,196,884
45,470
571,210
188,354
88,448
2,986,951
60
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
356
F62
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F63
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
19. Trade receivables and accrued revenue
Receivables from subscribers
Accounts and notes receivable
Undue assigned contracted receivables
31 December
2020
2,263,544
766,921
435,332
3,465,797
31 December
2019
2,090,242
745,442
298,291
3,133,975
Trade receivables are shown net of provision for impairment amounting to TL 617,932 as at
31 December 2020 (31 December 2019: TL 620,247). Movements in provision for impairment of trade
receivables and due from related parties are disclosed in Note 36. The accounts and notes receivable
represent receivables from distributors and roaming receivables. The Group’s exposure to currency risk
and credit risk arising from trade receivables are disclosed in Note 36.
Letters of guarantee received with respect to the accounts and notes receivable amounted to
TL 351,698 and TL 332,180 at 31 December 2020 and 2019, respectively.
The undue assigned contracted receivables are the remaining portion of the assigned receivables from the
distributors related to the handset campaigns which will be collected from subscribers by the Company
in instalments. When the monthly instalment is billed to the subscriber, that portion is transferred to
“Receivables from subscribers”. The Company measures the undue assigned contracted receivables at
amortized cost, bears the credit risk and recognizes interest income throughout the contract period.
The accrued revenue represents accrued revenue from subscribers. Due to the high volume of subscribers,
there are different billing cycles. Accordingly, an accrual is made at the end of each reporting period to
accrue revenue for services rendered but not billed. The undue assigned contracted receivables related to
handset campaigns, which will be billed after one year amounted
to TL 172,261
(31 December 2019: TL 116,462) is presented under non-current trade receivable amounted to
TL 222,451 (31 December 2019: TL 148,159).
20. Receivables from financial services
Current receivables from financial services
Non-current receivables from financial services
31 December
2020
1,886,381
75,717
1,962,098
31 December
2019
2,319,122
123,136
2,442,258
Movements in provision for impairment of receivables from financial services are disclosed in Note 36.
Starting from 2016 the Group and its distributors have offered handset campaigns where subscribers can
buy handsets using loans placed by Turkcell Finansman. The Group assumes credit risk in these
transactions. Turkcell Finansman collects the loan from the subscriber during the contract period and the
Group does not recognize handset revenue unless it is acting as principal in the handset sale.
21. Contract assets
Current contract assets:
Contract assets
31 December
2020
972,052
972,052
31 December
2019
933,969
933,969
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
21. Contract assets (continued)
Non-current contract assets:
Contract assets
31 December
2020
128,114
128,114
31 December
2019
10,291
10,291
The contract assets represent contract assets from subscribers. Due to the high volume of subscribers,
there are different billing cycles. Accordingly, an accrual is made at the end of each reporting period to
accrue revenue for services rendered but not billed. Contract assets also include contracted receivables
related to handset campaigns, and the portion which will be billed after one year is presented under long
term contract assets.
22.
Inventory
As of 31 December 2020, inventories amounting to TL 203,715 which consist of mainly mobile phone
and its accessories, tablet, sim-cards and tower construction materials (31 December 2019: TL 178,399).
23. Other current assets
Receivables from the Ministry of Transport and
Infrastructure of Turkey
Prepaid expenses
VAT receivable
Advances given to suppliers
Receivables from tax office
Other advances given
Other
24. Cash and cash equivalents
Cash in hand
Banks
- Demand deposits
- Time deposits
Other cash and cash equivalents
Cash and cash equivalents
31 December
2020
31 December
2019
224,563
163,657
49,490
48,141
20,864
-
52,271
558,986
669,621
135,881
109,777
90,454
99,882
65,263
156,126
1,327,004
31 December
2020
179
31 December
2019
131
11,852,022
975,753
10,876,269
8,354
11,860,555
10,238,310
632,022
9,606,288
274
10,238,715
As at 31 December 2020, the average effective interest rates of TL, USD and EUR time deposits are
17.4%, 2.8% and 1.8% (31 December 2019: 10.7%, 2.3% and 0.4%) respectively.
As at 31 December 2020, average maturity of time deposits is 30 days (31 December 2019: 38 days).
62
63
357
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
358
F64
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F65
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
25. Financial assets
25. Financial assets (continued)
Debt investments at fair value through other comprehensive income
Debt investments at fair value through other comprehensive income (continued)
Currency
31 December 2019
Nominal amount
(original currency)
Fair value
(in TL)
EUR
EUR
EUR
EUR
USD
USD
Total financial assets
17,990
10,000
20,000
2,000
300
1,000
121,456
67,773
133,072
15,026
1,878
6,397
345,602
Maturity
29 May 2020
5 February 2021
17 December 2021
16 February 2026
21 February 2022
10 August 2024
During the year, the following gains (losses) were recognized in other comprehensive income.
Gains / (Losses) recognized in other comprehensive income
Related to debt securities
31 December
2020
31 December
2019
(1,487)
(1,487)
3,472
3,472
Debt investments at FVOCI comprise the following investments in listed and unlisted securities:
Current Assets
Listed debt securities
31 December
2020
529,610
529,610
31 December
2019
345,602
345,602
Fair values
31 December
2020
31 December
2019
Fair value
hierarchy
Valuation technique
Financial
assets at fair
value through
other
comprehensive
income
272,334
-
Level 2
257,276
345,602
Level 1
Present value of the
estimated future cash
flows based on
observable yield
curves and period end
FX rates
Pricing models based
on quoted market
prices at the end of the
reporting period.
Total
529,610
345,602
As of 31 December 2020 and 2019, the nominal and fair value amounts of financial assets are as follows:
Currency
31 December 2020
Nominal amount
(original currency)
Fair value
(in TL)
EUR
EUR
EUR
EUR
TRY
TRY
USD
USD
Total financial assets
10,000
20,000
20,000
1,995
24,108
24,312
300
996
91,229
181,105
178,375
19,718
24,819
24,362
1,966
8,036
529,610
Maturity
5 February 2021
13 March 2021
17 December 2021
16 February 2026
2 March 2022
2 March 2022
21 February 2022
10 August 2024
64
65
359
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
360
F66
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F67
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
26. Equity
Share capital
As at 31 December 2020, share capital represents 2,200,000,000 (31 December 2019: 2,200,000,000)
authorized, issued and fully paid shares with a par value of TL 1 each. In this respect, share capital
presented in the consolidated financial statements refers to nominal amount of registered share capital.
Each holder of shares is entitled to receive dividends as declared and their vote entitlements are
determined as explained in Note 1.
Companies with their shareholding percentage are as follows:
Public Share
TVF BTIH
IMTIS Holdings
Turkcell Holding
Other
31 December 2020
TL
(%)
1,187,004
53.95
576,400
26.20
435,600
19.80
-
-
996
0.05
31 December 2019
(%)
TL
48.95
-
-
51.00
0.05
1,077,004
-
-
1,122,000
996
Total
Inflation adjustment to share capital
Inflation adjusted capital
100.00
2,200,000
100.00
(52,352)
2,147,648
2,200,000
(52,352)
2,147,648
As at 31 December 2020, total number of shares pledged as security is 995,509 (2019: 995,509).
Legal reserves
The legal reserves consist of first and second reserves, appropriated in accordance with the Turkish
Commercial Code (“TCC”). The TCC stipulates that the first legal reserve is appropriated out of statutory
profits at the rate of 5% per annum, until the total reserve reaches 20% of a company’s paid-in share
capital. The second legal reserve is appropriated at the rate of 10% per annum of all cash dividends in
excess of 5% of the paid-in share capital. Under the TCC, the legal reserves can only be used to offset
losses and are not available for any other usage unless they exceed 50% of paid-in share capital.
Treasury shares
During 2020, the Company purchased 816,290 of its shares on-market with prices ranging from full
TL 12.09 to full TL 12.35. The buyback was approved by the Board of Directors on 27 July 2016 and
30 January 2017. Total amount of TL 9,994 was deducted from equity (2019: TL 9,998).
Dividends
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
27. Earnings per share
Numerator:
Profit attributable to owners of the Company
Denominator:
Weighted average number of shares (*)
Basic and diluted earnings per share for
profit attributable to owners of the Company
(in full TL)
(*) Refer to Note 26 - Treasury shares
Numerator:
Profit from continuing operations attributable to
owners of the Company
Denominator:
Weighted average number of shares (*)
Basic and diluted earnings per share for
profit from continuing operations attributable
to owners of the Company (in full TL)
(*) Refer to Note 26 - Treasury shares
Numerator:
Profit from discontinuing operations attributable
to owners of the Company
Denominator:
Weighted average number of shares (*)
Basic and diluted earnings per share for profit
from discontinued operations attributable to
owners of the Company (in full TL)
(*) Refer to Note 26 - Treasury shares
2020
2019
2018
4,237,086
3,246,487
2,021,065
2,183,106,193
2,183,922,483
2,184,750,233
1.94
1.49
0.93
4,237,086
2,474,051
2,021,065
2,183,106,193
2,183,922,483
2,184,750,233
1.94
1.14
0.93
-
772,436
-
2,183,106,193
2,183,922,483
2,184,750,233
-
0.35
-
Inteltek:
According to the resolution of the Ordinary General Assembly Meeting of Inteltek dated 13 March 2020,
the shareholders resolved to pay a dividend amount equal to TL 38,029 out of profits for the year ended
to TL 34,985
31 December 2019 and a dividend out
(2019: TL 277,837 in total). The aggregate amount of dividends has been paid on 23 March 2020.
reserves amount equal
legal
Turkcell:
On 24 September 2020, the Company’s General Assembly has approved a dividend distribution for the
year ended 31 December 2019 amounting to TL 811,622 (2019: TL 1,010,000); this represents a gross
cash dividend of full TL 0.36892 per share. The dividend has been paid to the shareholders on
30 November 2020.
66
67
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
362
F68
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F69
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the year ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
28. Other non-current liabilities
29. Loans and borrowings (continued)
Consideration payable in relation to
the acquisition of Belarusian Telecom
Deferred revenue
2020
475,879
22,180
498,059
2019
359,554
303
359,857
Consideration payable in relation to the acquisition of Belarusian Telecom represents the present value of
the long-term contingent consideration payable to the seller. Payment of USD 100,000 (equivalent to
TL 734,050 as of 31 December 2020) is contingent on the financial performance of Belarusian Telecom,
and based on management’s estimations, the amount is expected to be paid in instalments between 2025
and 2030 (31 December 2019: in instalments between 2026-2030). The discount rate used for calculating
present value of the consideration payable in relation to the acquisition of Belarusian Telecom as of
31 December 2020 ranges between 4.3% and 5.6% (31 December 2019: 5.2% and 6.1%).
29. Loans and borrowings
Non-current liabilities
Unsecured bank loans
Secured bank loans
Lease liabilities
Debt securities issued
Current liabilities
Unsecured bank loans
Secured bank loans
Lease liabilities
Debt securities issued
31 December
2020
31 December
2019
7,779,354
151,543
1,521,713
6,901,075
16,353,685
4,049,824
144,261
577,173
461,479
5,232,737
6,092,170
-
1,101,303
5,483,921
12,677,394
6,712,297
2,415
431,752
481,869
7,628,333
The company has used loans in accordance with the loan agreement previously signed with J.P.Morgan
and AB Svensk Exportkredit under the Swedish Export Credit Organization (“EKN”) insurance. As of
31 December 2020, the Company has used USD 47,100 and USD 29,410 loan on 1 April 2020 and
27 November 2020, respectively, with a fixed interest rate of 3.84%.
As at 31 December 2020, the company signed a green loan agreement amounting to EUR 50,000 with
ING European Financial Services Plc. The respective loan has a maturity of 5 years and its annual interest
rate is Euribor+1.95%. The loan facility is utilized to finance sustainable investments such as renewable
energy, energy efficiency, green digital services and green buildings under the internationally recognized
Green Loan Principles. The loan will be repaid at once at the end of the 5-year maturity term. The loan
was fully utilized on 20 March 2020.
The company has signed a loan agreement amounting to USD 90,000 with ING BANK N.V. and AB
Svensk Exportkredit within the scope of the EKN insurance on 18 December 2020, which can be used for
financing the products and services procured from Ericsson AB and Ericsson Telekomunikasyon A.S..
Each tranches has a period of 15 months respectively and the last tranche will be available until
April 2024. The repayments of the tranches will be made in 2 equal installments per year and with a fixed
interest rate of 3.04%.
The company has signed a loan agreement amounting to EUR 500,000 with the China Development Bank
on 10 August 2020, which can be used for the infrastructure investment financing of the Group for
3 years, and can be utilized both in EUR and RMB. The maturity of the loan is 8 years and the first
3 years are without principal repayment. The annual interest rate of the loan is Euribor+2.29% for the
EUR tranche and the fixed 5.15% for the RMB tranche.
Within the scope of buy-back decisions on 27 July 2016, 30 January 2017 and 24 March 2020, the
Company sold their debt securities issued with a total nominal value of USD 20,500 as at
31 December 2020.
The company has decided to prepay and close its Club loan, which was utilized under the credit agreement
disclosed on 17 September 2015 and which is to fully mature on 16 September 2020. Accordingly, the
last two principal payments of the loan, which are due in June 2020 and September 2020 as per the credit
agreement and which in total amounted to EUR 148.4 million and USD 166.7 million were made on
23 March 2020.
On 4 June 2020, CMB approval has been taken on issuance of management agreement based lease
certificates in accordance with capital markets legislation in the domestic market, in Turkish Lira terms,
at an amount up to TL 600,000, on various dates and at various amounts without public offering, as private
placement and/or to be sold to institutional investors within one year. On 18 November 2020, the
Company has issued management agreement based lease certificates amounting TL 50,000 with the
maturity of 23 March 2021.
68
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
364
F70
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7
TURKCELL ILETISIM HIZMETLERI AS
F71
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
30. Employee benefits
Retirement pay liability provision
Unused vacation provision
31 December
2020
301,459
80,464
381,923
31 December
2019
222,164
72,167
294,331
Provision for employee termination benefits
Movements in provision for employee termination benefits are as follows:
1 January
Service cost
Remeasurements
Interest expense
Benefit payments
31 December
2020
222,164
38,304
37,230
25,535
(21,774)
301,459
2019
160,613
35,831
36,385
25,566
(36,231)
222,164
The sensitivity of provision for employee termination benefits to changes in the significant actuarial
assumptions is:
31 December 2020
Sensitivity Level
Change in assumption
Impact on provision for employee
termination benefits
31 December 2019
Sensitivity Level
Change in assumption
Impact on provision for employee
termination benefits
Interest Rate
Inflation Rate
1% increase 1% decrease
1% increase
1% decrease
(14.1%)
17.3%
17.6%
(14.6%)
(42,566)
52,122 53,117
(43,953)
Interest Rate
Inflation Rate
1% increase 1% decrease
1% increase
1% decrease
(14.2%)
17.4%
17.9%
(14.7%)
(31,547)
38,657
39,767
(32,658)
The above sensitivity analyses are based on a change in an assumption while holding all other assumptions
constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated.
Defined contribution plans
Obligations for contribution to defined contribution plans are recognized as an expense in the consolidated
statement of profit or loss as incurred. The Group incurred TL 14,677, TL 12,785 and TL 9,361 in relation
to defined contribution retirement plan for the years ended 31 December 2020, 2019 and 2018,
respectively.
Share based payments
The Group has a share performance based payment plan (cash settled incentive plan) in order to build a
common interest with its shareholders, support sustainable success, and ensure loyalty of key employees.
The KPIs of the plan are; the total shareholder return in excess of weighted average cost of capital
(WACC), and ranking of total shareholder return in comparison with BIST-30 and peer group. Bonus
amount is determined according to these evaluations, and it is distributed over a three-year payment plan.
As of 31 December 2020, the Group recognized expenses of TL 12,085 regarding this plan
(31 December 2019: TL 28,199).
71
365
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S
Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
366
F72
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F73
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
31. Deferred revenue
Deferred revenue primarily consists of rent income and it is classified as current at 31 December 2020
and 2019. The amount of deferred revenue is TL 116,921 and TL 56,544 as at 31 December 2020 and
2019, respectively.
32. Contract liabilities
Current contract liabilities:
Contract liabilities
Non-current contract liabilities:
Contract liabilities
31 December
2020
315,070
315,070
31 December
2019
290,408
290,408
31 December
2020
164,764
164,764
31 December
2019
141,890
141,890
Contract liabilities primarily consists of right of use sold but not used by prepaid subscribers.
Revenue recognized in the current reporting period relating to carried forward contract liabilities is
TL 290,408 (2019: TL 255,756).
The following table shows unsatisfied performance obligation result as of 31 December 2020;
Telecommunications service
Equipment revenues
Total
31 December 2020
900,816
423,948
1,324,764
Management expects that 61% of the transaction price allocated to the unsatisfied contracts as of
31 December 2020 will be recognized as revenue during next reporting periods. The remaining
39% will be recognized in the 2021 financial year.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
33. Provisions
Non-current provisions:
Balance at 1 January 2020
Provisions recognized
Unwinding of discount
Transfer to current provisions
Remeasurements
Effect of changes in exchange rates
Balance at 31 December 2020
Legal
claims
13,635
11,033
-
(7,774)
-
-
16,894
Balance at 1 January 2019
Provisions recognized
Unwinding of discount
Transfer to current provisions
Effect of changes in exchange rates
Balance at 31 December 2019
Legal claims
9,364
12,187
-
(7,916)
-
13,635
Obligations for
dismantling,
removing and
site restoration
323,769
7,840
21,521
-
39,504
2,403
395,037
Obligations for
dismantling,
removing and
site restoration
259,358
29,080
14,262
-
21,069
323,769
Total
337,404
18,873
21,521
(7,774)
39,504
2,403
411,931
Total
268,722
41,267
14,262
(7,916)
21,069
337,404
Provision for legal claims are recognized for the probable cash outflows related to legal disputes. Refer
to Note 38.
The Group is required to incur certain costs in respect of a liability to dismantle and remove assets and to
restore sites on which the assets were located. The dismantling costs are calculated according to best
estimate of future expected payments discounted at a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the liability.
It is expected that the obligations for dismantling, removing and site restoration will be realized in
accordance with the useful life of GSM services materials.
Additions to obligations for dismantling, removing and site restoration during the period are non-cash
transactions and are recorded against property, plant and equipment.
Obligations for dismantling, removing and site restoration are discounted using a discount rate of 9.9%
at 31 December 2020 (31 December 2019: 6.1%).
72
73
367
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S
Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
368
F74
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F75
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
33. Provisions (continued)
Current provisions:
Balance at 1 January 2020
Provisions recognized
Payments
Transfers from non-current provisions
Effect of changes in exchange rates
Balance at 31 December 2020
Legal claims(**)
17,840
232,879
(6,109)
7,774
1,249
253,633
Bonus(*)
324,972
590,187
(537,598)
-
(906)
376,655
Total
342,812
823,066
(543,707)
7,774
343
630,288
Balance at 1 January 2019
Provisions recognized
Payments
Transfers from non-current provisions
Effect of changes in exchange rates
Balance at 31 December 2019
Legal claims(**)
8,593
4,369
(4,344)
7,916
1,306
17,840
Bonus(*)
298,475
521,647
(501,234)
-
6,084
324,972
Total
307,068
526,016
(505,578)
7,916
7,390
342,812
(*) Includes share-based payment (Note 30).
(**) Refer to Note 38.
34. Trade and other payables
Payable to suppliers
Taxes payable
Accrued treasury share, universal service fund
contribution and contributions to the ICTA’s
expenses
Accrued selling and marketing expenses
Other
2020
3,563,918
668,260
533,440
4,477
206,510
4,976,605
2019
2,728,485
523,584
562,536
100,792
202,074
4,117,471
Payable to suppliers arises in the ordinary course of business.
Taxes payables include VAT payables, special communications taxes payable, frequency usage fees
payable to the ICTA and personnel income taxes payable.
Accrued selling and marketing expenses mainly result from services received from third parties related
to the marketing activities of the Group, but not yet invoiced.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
35. Derivative financial instruments
The fair value of derivative financial instruments at 31 December 2020 and 2019 are attributable to the
following:
31 December 2020
31 December 2019
Held for trading
Derivatives used for hedging
Total
Assets
360,047
642,623
1,002,670
Liabilities
41,132
66,851
107,983
Assets
443,880
483,448
927,328
Liabilities
72,539
-
72,539
the
financial assets of TL 917,437
At 31 December 2020,
total held
interest expense of TL 85,233
(31 December 2019: TL 845,513) also
(31 December 2019: TL 81,815) and the total held for trading derivative financial liabilities of TL 119,111
(31 December 2019: TL 86,617) also
interest expense of TL 11,128
(31 December 2019: TL 14,078).
for
includes a net accrued
includes a net accrued
trading derivative
Derivatives used for hedging
Participating cross currency swap and cross currency swap contracts
The notional amount and the fair value of participating cross currency swap and cross currency swap
contracts for hedging purposes at 31 December 2020 are as follows:
Sell
Buy
Currency
Notional
amount
Currency
Notional
amount Fair Value
Maturity
Participating cross currency swap contracts
TL
TL
TL
TL
TL
TL
TL
TL
TL
TL
TL
1,903,692
239,107
118,650
224,536
220,055
184,622
159,500
156,999
125,231
92,887
85,206
EUR
EUR
EUR
USD
USD
USD
USD
USD
USD
USD
USD
366,800
48,012
17,146
40,010
40,010
32,008
28,007
24,006
20,005
16,004
16,004
Cross currency swap contracts
TL
99,127
RMB
162,121
Derivatives used for hedge accounting financial assets
221,937
17,202
35,940
55,830
42,674
42,554
42,068
14,793
27,096
17,169
28,131
97,229
642,623
23 October 2025
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
EUR 414,812 participating cross currency swap contracts includes TL 1,121,303 guarantees after the CSA
agreement.
74
75
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F
N
A
N
C
A
L
I
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A
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A
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H
U
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A
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A
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A
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A
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A
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A
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A
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S
O
C
A
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I
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A
L
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S
A
N
D
R
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L
A
T
O
N
S
I
N
A
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A
L
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A
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I
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A
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A
P
P
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N
D
I
C
E
S
Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
370
F76
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F77
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
35. Derivative financial instruments (continued)
Interest rate swap contracts
35. Derivative financial instruments (continued)
Held for trading (continued)
The notional amount and the fair value of interest rate swap contracts for hedging purposes at 31 December
2020 are as follows:
Sell
Buy
Currency
Interest rate swap contracts
Notional
amount
Currency
Notional
amount Fair Value
USD
USD
USD
USD
80,020
40,010
32,008
28,007
USD
USD
USD
USD
Derivatives used for hedge accounting financial liabilities
80,020
40,010
32,008
28,007
(31,749)
(15,112)
(10,656)
(9,334)
(66,851)
Maturity
22 April 2026
22 April 2026
22 April 2026
22 April 2026
Held for trading
Cross currency swap, participating cross currency swap, FX swap and interest rate swap contracts
The notional amount and the fair value of cross currency swap, participating cross currency swap, FX
swap and interest rate swap contracts for hedging purposes at 31 December 2020 are as follows:
Sell
Buy
Currency
Notional
amount
Currency
Notional
amount
Fair Value
Maturity
Cross currency swap contracts
TL
TL
TL
TL
45,504
99,154
98,537
30,707
EUR
USD
USD
RMB
Participating cross currency swap contracts
EUR
218,295
EUR
148,117
TL
TL
TL
TL
TL
TL
146,677
73,747
98,295
95,944
EUR
EUR
USD
USD
7,200
17,143
17,143
38,801
32,008
24,006
24,006
10,861
16,004
16,004
20,853
31,140
31,575
14,535
67,361
62,688
80,075
19,909
13,356
17,978
23 September 2021
20 March 2023
20 March 2023
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
FX swap contracts
TL
73,135
USD
10,000
319
6 January 2021
Interest rate swap contracts
USD
17,778
USD
17,778
258
29 September 2028
FX swap, interest swap and participating cross currency swap contracts
The notional amount and the fair value of FX swap, interest swap and participating cross currency swap
contracts for hedging purposes at 31 December 2020 are as follows:
Sell
Buy
Currency
FX swap contracts
Notional amount
Currency
EUR
EUR
TL
TL
RMB
5,000
33,000
186,488
73,865
10,500
USD
USD
USD
USD
USD
Interest swap contracts
Notional
amount
6,116
40,075
25,000
10,000
1,544
Fair Value
Maturity
(148)
(3,148)
(2,851)
(411)
(488)
5 January 2021
12 January 2021
6 January 2021
6 January 2021
13 January 2021
USD
22,222
USD
22,222
(1,141)
29 September 2028
Participating cross currency swap contracts
TL
TL
195,850
155,340
Cross currency swap contracts
TL
TL
TL
188,851
224,100
154,600
USD
USD
EUR
EUR
USD
25,000
20,000
19,900
24,000
20,000
Total held for trading derivative financial liabilities
(3,811)
(5,890)
20 November 2025
20 November 2025
(11,663)
(2,021)
(6,747)
(38,319)
2 December 2021
21 December 2022
20 November 2025
Currency forward contracts
The notional amount and the fair value of currency forward contracts for trading purposes at
31 December 2020 are as follows:
Buy
Currency
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
Notional
amount
500
500
500
500
500
500
500
500
500
500
500
500
Fair Value
(194)
(212)
(216)
(221)
(226)
(232)
(237)
(242)
(250)
(253)
(262)
(268)
(2,813)
Maturity
31 January 2021
28 February 2021
31 March 2021
30 April 2021
29 May 2021
30 June 2021
31 July 2021
31 August 2021
30 September 2021
30 October 2021
30 November 2021
31 December 2021
371
A
B
O
U
T
T
U
R
K
C
E
L
L
V
A
L
U
E
I
C
R
E
A
T
N
G
T
U
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C
E
L
L
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N
G
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P
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A
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N
A
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N
A
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A
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A
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A
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A
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L
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A
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A
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A
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L
A
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S
I
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A
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U
R
A
L
C
A
P
I
T
A
L
A
P
P
E
N
D
I
C
E
S
Held for trading derivative financial assets
360,047
Held for trading derivative financial liabilities
76
77
Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
372
F78
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F79
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
35. Derivative financial instruments (continued)
Derivatives used for hedging
Participating cross currency swap and cross currency swap contracts
The notional amount and the fair value of participating cross currency swap and cross currency swap
contracts for hedging purposes at 31 December 2019 are as follows:
Sell
Notional
amount
Currency
Buy
Currency
Notional
amount Fair Value
Maturity
Participating cross currency swap contracts
TL
TL
TL
TL
TL
TL
TL
TL
1,820,280
257,478
85,593
145,000
128,833
97,833
64,667
245,951
Cross currency swap contracts
EUR
EUR
USD
USD
USD
USD
USD
USD
433,400
56,004
18,668
50,000
33,333
33,333
16,667
46,670
148,066
7,675
21,581
97,030
57,280
63,358
28,394
9,893
23 October 2025
22 April 2026
22 April 2026
16 September 2020
16 September 2020
16 September 2020
16 September 2020
22 April 2026
TL
115,628
RMB
189,107
50,171
22 April 2026
Derivatives used for hedge accounting financial assets
483,448
EUR 489,404 participating cross currency swap contracts includes TL 833,786 guarantees after the CSA
agreement.
35. Derivative financial instruments (continued)
Held for trading
Cross currency swap, participating cross currency swap, FX swap and option contracts
The notional amount and the fair value of cross currency swap, participating cross currency swap, FX
swap and option contracts for hedging purposes at 31 December 2019 are as follows:
Sell
Buy
Currency
Notional
amount
Currency
Notional
amount
Fair Value
Maturity
Cross currency swap contracts
TL
TL
TL
TL
TL
TL
TL
242,873
269,451
137,952
138,816
84,224
91,008
35,818
USD
USD
USD
USD
EUR
EUR
RMB
Participating cross currency swap contracts
EUR
EUR
EUR
EUR
172,772
171,092
227,750
77,520
TL
TL
TL
TL
TL
TL
TL
TL
TL
TL
FX swap contracts
USD
USD
Option contracts
EUR
USD
261,912
108,349
135,051
215,354
174,000
186,050
20,000
20,000
25,000
50,000
USD
USD
USD
USD
USD
USD
TL
TL
USD
TL
Held for trading derivative financial assets
70,500
70,500
24,000
24,000
15,040
14,400
45,259
28,002
28,002
37,336
12,000
46,670
18,668
23,335
37,336
30,000
32,669
178,968
148,452
5,625
5,044
10,691
5,141
944
16 September 2020
22 December 2020
20 March 2023
23 March 2023
23 September 2021
23 September 2021
22 April 2026
9,904
21,355
8,705
1,097
12,195
3,930
4,674
7,813
1,506
9,936
22 April 2026
22 April 2026
22 April 2026
16 September 2020
22 April 2026
22 April 2026
22 April 2026
22 April 2026
15 June 2026
22 April 2026
117,860
117,900
67
51
27 February 2020
27 February 2020
28,038
275,000
186
11
436,295
3 January 2020
3 January 2020
78
79
373
A
B
O
U
T
T
U
R
K
C
E
L
L
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A
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N
D
I
C
E
S
Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
374
F80
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
35. Derivative financial instruments (continued)
Held for trading (continued)
Currency forward contracts
The notional amount and the fair value of currency forward contracts for trading purposes at
31 December 2019 are as follows:
Buy
Currency
USD
USD
USD
USD
USD
USD
USD
Notional
amount
30,000
7,500
7,500
10,000
10,000
7,500
7,500
Held for trading derivative financial assets
Fair Value
2,081
952
916
1,038
1,016
797
785
7,585
Maturity
28 February 2020
30 March 2020
29 June 2020
30 March 2020
29 June 2020
30 March 2020
29 June 2020
FX swap, interest swap and participating cross currency swap contracts
The notional amount and the fair value of FX swap, interest swap and participating cross currency swap
contracts for hedging purposes at 31 December 2019 are as follows:
Sell
Buy
Currency
Notional amount
Currency
Notional
amount Fair Value
Maturity
FX swap contracts
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
TL
Interest swap contracts
USD
USD
USD
USD
50,000
75,000
175,000
50,000
50,000
85,000
90,000
20,000
175,000
50,000
70,000
90,000
50,000
11,211
93,340
46,670
37,336
32,669
Participating cross currency swap contracts
TL
TL
105,848
162,552
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
USD
Total held for trading derivative financial liabilities
80
55,488
83,232
194,560
55,588
55,588
94,397
100,492
22,332
195,346
55,825
78,154
100,484
55,825
1,860
93,340
46,670
37,336
32,669
18,668
28,002
(3,005)
(4,512)
(8,508)
(2,432)
(2,434)
(4,748)
(2,301)
(510)
(4,875)
(1,448)
(2,036)
(2,612)
(1,448)
(3)
(7,802)
(3,101)
(959)
(849)
(14,265)
(4,691)
(72,539)
07 January 2020
07 January 2020
08 January 2020
08 January 2020
08 January 2020
08 January 2020
21 January 2020
21 January 2020
22 January 2020
28 January 2020
28 January 2020
28 January 2020
28 January 2020
28 February 2020
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
22 April 2026
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
35. Derivative financial instruments (continued)
Fair value of derivative instruments and risk management
This section explains the judgments and estimates made in determining the fair values of the financial
instruments that are recognized and measured at fair value in the financial statements. To provide an
indication of the reliability of the inputs used in determining fair value, the Group has classified its
financial instruments into the three levels prescribed under the accounting standards. An explanation of
each level is as follows:
• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the
entity can access at the measurement date;
• Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the
asset or liability, either directly or indirectly; and
• Level 3 inputs are unobservable inputs for the asset or liability.
Fair values
a) Participating cross
currency swap
contracts (*)
-Held for trading
-Derivatives used for
hedging
b) FX swap, currency,
interest swap and
option contracts
31 December
2020
31 December
2019
Fair Value
hierarchy
Valuation Techniques
797,060
495,436
Level 3
Pricing models based on
discounted cash Present value of
the estimated future cash flows
based on unobservable yield
curves and end period FX rates
251,666
545,394
62,159
433,277
100,440
351,768
Level 2
Present value of the estimated
future cash flows based on
observable yield curves and end
period FX rates
-Held for trading
70,062
301,597
-Derivatives used for
hedging
c) Currency forward
contracts
30,378
50,171
(2,813)
7,585
Level 2
Forward exchange rates at the
balance sheet date
-Held for trading
(2,813)
7,585
(*) Since the bid-ask spread is unobservable input; in the valuation of participating cross currency swap contracts, prices in the
bid- ask price range that were considered the most appropriate were used instead of mid prices. If mid prices were used in the
valuation the fair value of participating cross currency swap contracts would have been TL 168,882 lower as at
31 December 2020 (31 December 2019: TL 116,684).
There were no transfers between fair value hierarchy levels during the year.
81
375
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D
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S
Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
376
F82
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
378
F84
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F85
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
35. Derivative financial instruments (continued)
Fair value of derivative instruments and risk management (continued)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
35. Derivative financial instruments (continued)
Fair value of derivative instruments and risk management (continued)
Movements in the participating cross currency swap contracts for the years ended 31 December 2020 and
31 December 2019 are stated below:
Currency risk
Opening balance
Cash flow effect
Total gain/loss:
Gains recognized in profit or loss
Closing balance
Net off / Offset
31 December
2020
495,436
(695,892)
31 December
2019
653,142
(582,580)
997,516
797,060
424,874
495,436
The Company signed a Credit Support Annex (CSA) against the default risk of parties in respect of a
EUR 366,800 participating cross currency swap transaction executed on 15 July 2016 and restructured
respectively on 26 May 2017 and 9 August 2018. Additionally, in the 25 June 2019, The Company signed
a new CSA to EUR 48,012 participating cross currency swap transaction. As per the CSA, the swap’s
current (mark-to-market) value will be determined on the 10th and 24th calendar day of each calendar
month, and if the mark-to-market value is positive and exceeds a certain threshold, the bank will be
posting cash collateral to the Company which will be equal to an amount exceeding the threshold (i.e. if
the mark-to-market value is negative, the Company would be required to post collateral to the bank by an
amount exceeding the threshold).
With respect to valuations, on a bi-weekly basis, a transfer will take place between the parties only if the
mark-to-market value changes by at least EUR 1,000. Following the execution of CSA, the bank
transferred to the Company EUR 268,563 as collateral (31 December 2020: TL 2,419,189) which was the
amount exceeding the threshold and the Company transferred EUR 144,083 as collateral to the bank
(31 December 2020: TL 1,297,886) which was the amount exceeding the threshold. The Company
clarified this with the derivative assets included in the statement of financial position because it has the
legal right to offset the collateral amount TL 1,121,303 that it recognizes under the borrowings and intends
to pay according to the net fair value. This amount was netted from the borrowings and deducted from
the derivative instruments in the balance sheet. As of 31 December 2020, were this transaction not
conducted, derivative financial instruments assets would have been TL 2,038,740 and current borrowings
TL 6,354,040.
Market risk
The Group uses various types of derivatives to manage market risks. All such transactions are carried out
within the guidelines set by the treasury and risk management department. Generally, the Group seeks to
apply hedge accounting to manage volatility in profit or loss.
The Group’s risk management policy is to hedge its estimated foreign currency exposure in respect of
borrowing payments with various maturities at any point in time. The Group uses participating cross
currency contracts to hedge its currency risk, mostly with a maturity of over one year from the reporting
date. These contracts are generally designated as cash flow hedges.
The Group designates the hedge ratio, between the amount of the hedged item and the hedging instrument
is 1:1 to hedge its currency risk.
The time value of options in participating cross currency swap contracts are included in the designation
of the hedging instrument and are separately accounted for as a cost of hedging, which is recognized in
equity in a cost of hedging reserve. The Group’s policy is for the critical terms of the participating cross
currency contracts to align with the hedged item.
The Group determines the existence of an economic relationship between the hedging instruments and
hedged item based on the currency, amount and timing of their respective cash flows. The Group assesses
whether the derivative designated in each hedging relationship is expected to be and has been effective in
offsetting changes in cash flows of the hedged item using the hypothetical derivative method.
In these hedge relationships, the main sources of ineffectiveness are;
- The effect of the counterparties’ credit risk on the fair value of the swap contracts, which is not part of
the hedged risk and associated credit risk considered to be very low at inception in the fair value of the
hedged cash flows attributable to the change in exchange rates;
- The entire fair value of the derivative contracts including currency basis was designated as the hedging
instrument in cash flow hedge. The hypothetical derivative is modelled to exclude the impact of currency
basis.
Interest rate risk
The Group adopts a policy of ensuring that its interest rate risk exposure is at a fixed rate. This is achieved
partly by entering into fixed-rate instruments and partly by borrowing at a floating rate and using cross
currency and interest rate swaps as hedges of the variability in cash flows attributable to movements in
interest rates. The Group applies a hedge ratio of 1:1.
The Group determines the existence of an economic relationship between the hedging instrument and
hedged item based on the reference interest rates, tenors, repricing dates and maturities and the notional
or par amounts.
The Group assesses whether the derivative designated in each hedging relationship is expected to be
effective in offsetting changes in cash flows of the hedged item using the hypothetical derivative method.
In these hedge relationships, the main sources of ineffectiveness are:
- The effect of the counterparties’ credit risk on the fair value of the swap contracts, which is not part of
the hedged risk and associated credit risk considered to be very low at inception in the fair value of the
hedged cash flows attributable to the change in interest rates;
84
85
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
380
F86
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
35. Derivative financial instruments (continued)
Fair value of derivative instruments and risk management (continued)
Cash flow sensitivity analysis for variable-rate instruments
A reasonable potential change of 100 basis points in interest rates and 10% change in foreign exchange
currency at the reporting date would have increased (decreased) equity and profit or loss by the amounts
shown below. This analysis assumes that all other variables remain constant.
Profit or Loss
100 bp
increase
100 bp
decrease
Equity, net of tax
100 bp
increase
100 bp
decrease
1,158,627
49,843
1,208,470
849,915
45,528
895,443
Profit or Loss
100 bp
increase
100 bp
decrease
(516,772)
11,132
(505,640)
(247,934)
12,642
(235,292)
Equity, net of tax
100 bp
increase
100 bp
decrease
376,920
17,631
394,551
519,967
16,516
536,483
(102,693)
(16,644)
(119,337)
(180,974)
(18,114)
(199,088)
31 December 2020
Participating cross currency swap
contracts
Cross currency swap contracts
Cash Flow sensitivity (net)
31 December 2019
Participating cross currency swap
contracts
Cross currency swap contracts
Cash Flow sensitivity (net)
36. Financial instruments
Credit risk
Exposure to credit risk:
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure
to credit risk at the reporting date is:
Trade receivables
Contract assets
Receivables from financial services
Cash and cash equivalents (*)
Derivative financial instruments
Other current & non-current assets (**)
Financial assets at amortized cost
Financial assets at fair value through other
comprehensive income
Due from related parties
19
21
20
24
35
23
25
2020
3,688,248
1,100,166
1,962,098
11,860,376
917,437
124,822
172,363
529,610
16,476
20,371,596
2019
3,282,134
944,260
2,442,258
10,238,584
845,513
98,736
5,368
345,602
4,477
18,206,932
(*) Cash in hand is excluded from cash and cash equivalents.
(**) Prepaid expenses, VAT receivable, receivable from the Ministry of Transport and Infrastructure of
Turkey, other and advances given are excluded from other current assets and other non-current assets.
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8
8
TURKCELL ILETISIM HIZMETLERI AS
F89
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
36. Financial instruments (continued)
Impairment losses
Individual receivables, which are known to be uncollectible are written off by reducing the carrying
amount directly. The other receivables are assessed collectively to determine whether there is objective
evidence that an impairment has been incurred but not yet identified. The Group considers that there is
evidence of impairment if any of the following indicators are present:
Significant financial difficulties of the customer,
Probability that the customer will enter bankruptcy or financial reorganization and
Default or delinquency in payments.
Receivables for which an impairment provision was recognized are written off against the provision when
there is no expectation of recovering additional cash.
Impairment losses are recognized in profit or loss within net impairment losses on financial and contract
assets (Note 10). Subsequent recoveries of amounts previously written off are credited against Net
impairment losses on financial and contract assets (Note 10).
Movements in the provision for impairment of trade receivables, contract assets, other assets and due from
related parties are as follows:
Opening balance
Provision for impairment recognized during the year
Amounts collected
Receivables written off during the year as uncollectible
Disposal of subsidiaries
Exchange differences
Closing balance
Opening balance
Provision for impairment recognized during the year
Amounts collected
Transfer
Receivables written off during the year as uncollectible
Exchange differences
Closing balance
31 December
2020
Contract Asset
4,690
553
-
-
-
-
5,243
31 December
2019
Contract Asset
7,370
1,105
-
(3,785)
-
-
4,690
31 December
2020
Other Asset
627,578
452,506
(153,674)
(300,119)
(49)
1,138
627,380
31 December
2019
Other Asset
730,811
376,107
(147,858)
3,785
(346,049)
10,782
627,578
89
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
384
F90
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
36. Financial instruments (continued)
Impairment losses (continued)
Movements in the provision for impairment of trade receivables, subscriber receivables, other assets and
cash and cash equivalents from financial services are as follows:
Opening balance
Provision for impairment recognized during the year
Amounts collected
Receivables written off during the year as uncollectible
Exchange differences
Unused amount reversed (*)
Closing balance
31 December
2020
163,500
126,246
(76,036)
-
(96)
(59,066)
154,548
31 December
2019
200,273
245,365
(135,862)
(147,067)
791
-
163,500
(*) Turkcell Finansman signed a transfer of claim agreement with a debt management company to transfer some of its doubtful
receivables stemming from the years 2016 and 2019. Transferred doubtful receivables comprise of balances that Turkcell
Finansman started legal proceedings for.
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
386
F92
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F93
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
36. Financial instruments (continued)
Foreign exchange risk
The Group’s exposure to foreign exchange risk at the end of the reporting period, based on notional
amounts, was as follows:
Foreign currency denominated assets
Other non-current assets
Financial asset at fair value through other
comprehensive income
Due from related parties - current
Trade receivables and contract assets
Other current assets
Cash and cash equivalents
Foreign currency denominated liabilities
Loans and borrowings - non-current
Debt securities issued - non-current
Lease obligations - non-current
Other non-current liabilities
Loans and borrowings - current
Debt securities issued - current
Lease obligations - current
Trade and other payables - current
Due to related parties
31 December 2020
EUR
USD
RMB
69
11
-
8,848
-
13,234
11,769
1,061,644
1,095,564
(342,930)
(940,137)
(6,822)
(64,829)
(85,526)
(55,938)
(721)
(174,039)
-
(1,670,942)
64,956
-
15,239
3,737
85,856
169,799
(543,680)
-
(17,000)
-
(244,057)
-
(3,598)
(23,944)
(11)
(832,290)
-
-
-
-
4,801
4,801
(160,398)
-
-
-
(92,931)
-
-
(487,738)
-
(741,067)
Loans defined as hedging instruments (*)
Exposure related to derivative instruments
Participating cross currency swap and FX swap contracts
Currency forward contracts
Net exposure
-
164,634
-
440,036
256,118
120,776
535,939
-
38,082
190,421
-
(545,845)
(*) The Company designated EUR 164,634 of bank loan, as hedging instruments in order to hedge the
foreign currency risk arising from the translation of net assets of the subsidiaries operating in Europe from
EUR to Turkish Lira. Foreign exchange gains/losses of the related loans are recognized under equity as
“gains/(losses) on net investment hedges” in order to offset the foreign exchange gains/(losses) arising
from the translation of the net assets of investments in foreign operations to Turkish Lira.
36. Financial instruments (continued)
Foreign exchange risk (continued)
Foreign currency denominated assets
Other non-current assets
Financial asset at fair value through other
comprehensive income
Due from related parties - current
Trade receivables and contract assets
Other current assets
Cash and cash equivalents
Foreign currency denominated liabilities
Loans and borrowings - non-current
Debt securities issued - non-current
Lease obligations - non-current
Other non-current liabilities
Loans and borrowings - current
Debt securities issued - current
Lease obligations - current
Trade and other payables - current
Due to related parties
31 December 2019
EUR
USD
RMB
71
5,412
1,393
152
17,383
10,602
173,376
202,977
(351,444)
(923,188)
(2,399)
(60,529)
(402,507)
(55,060)
(725)
(156,320)
(1,022)
(1,953,194)
50,721
581
38,496
4,979
1,203,574
1,303,763
(577,675)
-
(19,282)
-
(385,371)
-
(5,178)
(44,103)
(51)
(1,031,660)
-
-
-
-
-
-
-
(192,367)
-
-
-
(44,880)
-
-
(555)
-
(237,802)
Loans defined as hedging instruments
Exposure related to derivative instruments
Participating cross currency swap and FX swap contracts
Net exposure
-
145,105
-
1,830,226
80,009
(430,816)
(13,608)
234,367
(3,435)
92
93
387
A
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S
Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
388
F94
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F95
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
36. Financial instruments (continued)
Exposure to currency risk
Sensitivity analysis
The basis for the sensitivity analysis to measure foreign exchange risk is an aggregate corporate-level currency
composed of all assets and liabilities denominated in
exposure. The aggregate foreign exchange exposure is
foreign currencies, the analysis excludes net foreign currency investments.
A 10% strengthening/weakening of the TL, UAH, BYN, EUR against the following currencies as at
31 December 2020 and 31 December 2019 would have increased/(decreased) profit or loss before by the
amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain
constant.
Sensitivity analysis
31 December 2020
Profit/(Loss)
Equity
Appreciation of
foreign currency
Depreciation of
foreign currency
Appreciation of
foreign currency
Depreciation of
foreign currency
88,656
-
88,656
(88,656)
-
(88,656)
-
(14,984)
(14,984)
-
14,984
14,984
1- USD net asset/liability
2- Hedged portion of USD risk (-)
3- USD net effect (1+2)
4- EUR net asset/liability
5- Hedged portion of EUR risk (-)
6- EUR net effect (4+5)
34,304
-
34,304
7- Other foreign currency net asset/liability
(RMB)
8- Hedged portion of other foreign currency risk
(-) (RMB)
9- Other foreign currency net effect (7+8)
Total (3+6+9)
(61,036)
-
(61,036)
61,924
(34,304)
-
(34,304)
61,036
-
61,036
(61,924)
-
(79,669)
(79,669)
-
(192)
(192)
(94,845)
-
79,669
79,669
-
192
192
94,845
Sensitivity analysis
31 December 2019
Profit/(Loss)
Equity
Appreciation of
foreign currency
Depreciation of
foreign currency
Appreciation of
foreign currency
Depreciation of
foreign currency
(47,527)
-
(47,527)
9,050
-
9,050
290
-
290
(38,187)
-
(6,135)
(6,135)
-
(39,558)
(39,558)
-
(1,379)
(1,379)
(47,072)
-
6,135
6,135
-
39,558
39,558
-
1,379
1,379
47,072
1- USD net asset/liability
2- Hedged portion of USD risk (-)
3- USD net effect (1+2)
4- EUR net asset/liability
5- Hedged portion of EUR risk (-)
6- EUR net effect (4+5)
7- Other foreign currency net asset/liability
(RMB)
8- Hedged portion of other foreign currency risk
(-) (RMB)
9- Other foreign currency net effect (7+8)
Total (3+6+9)
47,527
-
47,527
(9,050)
-
(9,050)
(290)
-
(290)
38,187
94
36. Financial instruments (continued)
Interest rate risk
As at 31 December 2020 and 2019 the interest rate profile of the Group’s variable rate interest-bearing
financial instruments was:
31 December 2020
31 December 2019
Effective
Interest
Note
Rate
Carrying
Amount
Effective
interest
rate
Carrying
Amount
Variable rate
instruments
USD floating rate loans 29
EUR floating rate loans 29
Sensitivity analysis
3.2%
2.2%
(2,644,049)
(5,660,654)
4.4%
2.2%
(4,478,457)
(5,638,726)
Cash flow sensitivity analysis for variable rate instruments:
An increase/decrease of interest rates by 100 basis points would have (decreased)/increased equity and
profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular
foreign exchange rates, remain constant. The analysis is performed on the same basis at
31 December 2020 and 2019:
Profit or loss
Equity
100 bps
increase
100 bps
decrease
100 bps
increase
100 bps
decrease
(23,510)
(23,510)
23,510
23,510
(225,528)
(225,528)
225,528
225,528
-
-
-
-
-
-
-
-
31 December 2020
Variable rate instruments (financial
liability)
Cash flow sensitivity (net)
31 December 2019
Variable rate instruments (financial
liability)
Cash flow sensitivity (net)
Fair values
Fair value of the Group’s financial assets and financial liabilities that are measured at fair value on a
recurring basis
This section explains the judgments and estimates made in determining the fair values of the financial
instruments that are recognized and measured at fair value in the financial statements. To provide an
indication about the reliability of the inputs used in determining fair value, the Group has classified its
financial instruments into the three levels prescribed under the accounting standards. An explanation of
each level is as follows:
• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the
entity can access at the measurement date;
• Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the
asset or liability, either directly or indirectly; and
• Level 3 inputs are unobservable inputs for the asset or liability.
95
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
390
F96
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F97
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
36. Financial instruments (continued)
Fair values (continued)
Valuation inputs and relationships to fair value
36. Financial instruments (continued)
Fair values (continued)
Financial liabilities (continued):
The following table summarizes the quantitative information about the significant unobservable inputs
used in level 3 fair value measurement of contingent consideration.
Fair value at
31
December
2020
31
December
2019
475,879
359,554
Contingent
consideration
Unobservable
Inputs
Risk-adjusted
discount rate
Expected
settlement
date
Inputs
31
December
2020
31
December
2019
%4.3-%5.6
5.2%-6.1%
in
instalments
between
2025-2030
in
instalments
between
2026-2030
Relationship of unobservable inputs to
fair value
An increase/decrease in the discount rate
by 100 bps would change FV by
TL (35,686) and TL 39,070, respectively.
If expected settlement date
increase/decrease by 1-year, FV would
change by TL (23,724) and TL 24,978,
respectively.
As at 31 December 2020, the fair value of debt securities issued by the Company in 2015 and 2018 with
a nominal value of USD 500,000 each and fixed interest rate (Note 29), is TL 3,976,852
(31 December 2019: TL 3,058,366) and TL 3,972,232 (31 December 2019: TL 2,961,300), respectively.
Fair value of cash and cash equivalents and debt securities issued are classified as level 1 and fair value
of other financial assets and liabilities are classified as level 2.
37. Guarantees and purchase obligations
At 31 December 2020, outstanding purchase commitments with respect to property, plant and equipment,
inventory, advertising and sponsorship amount to TL 840,208 (31 December 2019: TL 819,508).
Payments for these commitments will be made within 4 years.
The Group is contingently liable in respect of letters of guarantee obtained from banks and given to public
institutions and private entities, and financial guarantees provided to subsidiaries amounting to
TL 4,146,811 at 31 December 2020 (31 December 2019: TL 4,842,015).
Changes in the consideration payable in relation to acquisition of Belarusian Telecom for the years ended
31 December 2020 and 31 December 2019 are stated below:
38. Commitments and Contingencies
Opening balance
Losses recognized in profit or loss
Closing balance
Financial assets:
2020
359,554
116,325
475,879
2019
358,304
1,250
359,554
Carrying values of a significant portion of financial assets do not differ significantly from their fair
values due to their short-term nature. Fair values of financial assets are presented in Note 25.
Financial liabilities:
As at 31 December 2020 and 31 December 2019; for the majority of the borrowings, the fair values are
not materially different to their carrying amounts since the interest payable on those borrowings is either
close to current market rates or the borrowings are of a short term nature. Material differences are
identified only for the following borrowings:
As at 31 December 2020:
Bank loans
As at 31 December 2019:
Bank loans
Carrying
amount
4,615,559
Carrying
amount
4,149,275
Fair
value
4,646,152
Fair
value
4,192,304
The following disclosures comprise of material lawsuits and investigations against the Company.
Disputes on Special Communication Tax and Value Added Tax
Disputes on SCT for the year 2011
The Large Taxpayers Office levied Special Communication Tax (SCT) and tax penalty on the Company
as a result of the Tax Investigation for the year 2011. The Company filed lawsuits for the cancellation of
the notification regarding the aforementioned SCT assessment. The court partially accepted and partially
rejected the cases and the parties appealed the decisions regarding the parts against them. The Large
Taxpayers Office has collected TL 80,355 calculated for the parts against the Company for the assessment
of the SCT for the year 2011 by offsetting the receivables of the Company from Public Administrations.
While the cases are pending before the court of appeal the Company filed application for the restructuring
as per Law no. 6736. The tax Office has rejected the application. The Company has also filed a case for
the cancellation of aforementioned rejection act of the Tax Office. In this case, with the decision that
notified to the Company on 14 April 2020, the Council of State decided to cancel the rejection act
regarding the application for the restructuring. The Large Taxpayers Office and Ministry of Treasury and
Finance appealed the decision. The Company replied the appeal request in due time. The appeal process
is pending.
In the cases regarding the cancellation of the SCT assessment for the year 2011, Council of State accepted
the appeal and decided to reverse the first instance court decisions in favor of the Company, on the ground
that; in the case filed for the cancellation of the rejection act regarding the request to restructure the cases
filed for the year 2011, the court decided in favor of the Company and since the mentioned case will
affect these cases, finalization of the respective decision should be waited. The Large Taxpayers Office
applied for the correction of the decisions. The Company replied to application for the correction of the
decisions. The Council of State, rejected the correction of decision requests of the Large Taxpayers
Office, in favor of the Company.
96
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
392
F98
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F99
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
38. Commitments and Contingencies (continued)
Disputes regarding the Law on the Protection of Competition
The investigation initiated by the Competition Board with respect to the practices of the Company
regarding the distributors and their dealers in the distribution network. As a result of the investigation the
Competition Board rejected the claims that Turkcell determined the resale price. But with the same
decision, The Competition Board decided to apply administrative fine on the Company amounting to
TL 91,942, on the ground that the Company forced its sub dealers to actual exclusivity. The Company
filed a lawsuit on 8 December 2011 for the stay of execution and cancellation of the aforementioned
Board decisions regarding the parts against itself. The Court rejected the case. The Company appealed
the decision, but the Council of State Plenary Session of the Chambers for Administrative Cases decided
to approve the first instance court’s decision. The Company made an individual application to the
Constitutional Court, against the respective decision within due time. The Constitutional Court process is
pending.
Also, the Large Taxpayers Office issued a payment order regarding the aforementioned administrative
fine. The Company has not made any payments and filed a lawsuit for the stay of execution and
cancellation of the payment order. The Court accepted the case. The Large Taxpayers Office appealed
the decision. As a result of the appeal process, due to the reverse decision of the Council of State about
the first instance court decision, the case file was sent to the first instance court and the trial of the case
is pending before the same.
Three private companies filed a lawsuits against the Company in relation with this case claiming in total
of TL 112,084 together with up to 3 times of the loss amount to be determined by the court for its material
damages by reserving its rights for surpluses allegedly. Among these cases, in the case filed for the
compensation of total TL 110,484 material damages together with compensation amounting to three times
of the damage and interest, the court decided to reject the case in favor of the Company, at the hearing on
12 June 2019. The plaintiff appealed the case before Regional Administrative Court. The appeal process,
before Regional Administrative Court, is pending. The other cases are also pending.
On the other hand, a lawsuit was filed by a third party, for the cancellation of the part of the
aforementioned Competition Board decision, regarding the rejection of the claims that Turkcell
determined the resale price. The Council of State cancelled this part of the aforementioned Competition
Board decision. Thereafter Competition Board launched a new investigation and as a result of it the
Competition Board decided to apply administrative fine amounting to TL 91,942 on the Company. The
Company has taken all legal actions by requesting the cancellation of the aforementioned decision and its
withdrawal by the Competition Authority. The Competition Authority accepted some of the objections
of the Company and reduced the administrative fine to TL 61,294 with its decision.
The aforementioned fine that amount of TL 61,294 was paid with twenty five percent discount on
9 April 2020, in the amount of TL 45,971. Then, a lawsuit was filed on 10 April 2020 for cancellation of
the aforementioned administrative fine. The hearing was held on 19 January 2021 in this case and it is
expected that the court will grant a decision.
Ministry of Commerce Administrative Fine
As a result of the investigation conducted by the Ministry of Commerce for the year 2015, against the
Company due to the alleged violation on distance contracts, hire purchase agreements and subscriber
agreements, Ministry of Commerce imposed an administrative fine in the amount of TL 138,173. The
Company filed a lawsuit for the cancellation of the related transactions. The Court accepted the case in
favor of the Company and cancelled the administrative fine. Istanbul Governorship appealed the decision
before Regional Administrative Court. Regional Administrative Court rejected the appeal request in favor
of the Company. Istanbul Governorship appealed the decision before the Council of State. The Company
replied this request in due time. As a result of the appeal process, the Council of State decided to reverse
the Regional Administrative Court’s decision and decided to send the case file to the Regional
Administrative Court to redecide after having an expert examination.
98
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
38. Commitments and Contingencies (continued)
ICTA Investigation Regarding the R&D Obligations (Period of 2013-2016)
ICTA initiated an investigation on the obligation of investing to products in electronic communication
network and communication services, partly from suppliers which have a R&D center in Turkey; partly
from the products manufactured in Turkey by SME suppliers which are established to develop products
or systems in Turkey; and partly from products that are certified to be domestic goods within the
framework of the relevant legislation. As a result of the investigation ICTA has decided to imposed an
administrative fine of TL 18,031 to Turkcell. The administrative fine notified to Turkcell on 29 January
2021 and was paid on 26 February 2021 as TL 13,523 with taking on the account the early payment
discount (1/4). The Company filed totally ten different lawsuits for the cancellation of the administrative
fines. There has not been any progress in the cases yet.
Based on the management opinion, the probability of an outflow of resources embodying economic
benefits is more than probable, thus, the amount of TL 13,523 that will be paid in February 2021 is
recognized as liability in the consolidated financial statements as at and for the period ended
31 December 2020 (31 December 2019: None).
ICTA Investigation Regarding the R&D Obligations (Period of 2016-2017)
ICTA initiated an investigation on the obligation of investing to products in electronic communication
network and communication services, partly from suppliers which have a R&D center in Turkey; partly
from the products manufactured in Turkey by SME suppliers which are established to develop products
or systems in Turkey; and partly from products that are certified to be domestic goods within the
framework of the relevant legislation. As a result of the investigation ICTA has decided to imposed an
administrative fine of TL 31,139 to Turkcell. The administrative fine notified to Turkcell on
29 January 2021 and was paid on 26 February 2021 as TL 23,354 with taking on the account the early
payment discount (1/4). The Company filed totally seven different lawsuits for the cancellation of the
administrative fines. There has not been any progress in the cases yet.
Based on the management opinion, the probability of an outflow of resources embodying economic
benefits is more than probable, thus, the amount of TL 23,354 that will be paid in February 2021 is
recognized as liability in the consolidated financial statements as at and for the period ended
31 December 2020 (31 December 2019: None).
Other ongoing lawsuits and tax investigations
In 2019, JSC Kazakhtelecom initiated arbitration proceedings against the Company related to its
acquisition of JSC Kcell shares, which was subsidiary of the Fintur. The total claim against Turkcell and
other shareholder Telia Company A.B. amounts to TL 484 million (USD 66 million) plus interest, of
which Turkcell’s share amounts to TL 137 million (USD 19 million) under the scope of agreements signed
by parties. The arbitration proceeding continues.
On the other hand, JSC Kazakhtelecom has initiated another arbitration case against the Company and
Telia Company A.B with the claim of indemnification due to revocation of a frequency license. At the
current stage, the total claim has not been specified by JSC Kazakhtelecom. The arbitration proceeding
continues.
Probability of an outflow of resources embodying economic benefits for 2018 and 2019 fiscal years with
regards to notification of Information and Communication Technologies Authority for radio fee related
to 2018 fiscal year was considered by the Company management. In this respect, TL 128,429 was paid in
November 2019 by reserving our right to take legal actions and legal actions were taken for 2018 fiscal
year. The lawsuits are pending. On the other hand, additional TL 13,465 for 2018/December was paid
with reservation on 29 January 2021 with regards to notification of Information and Communication
Technologies Authority for the same reason. Treasury share investigation related with the periods of July,
August and September of 2020 fiscal year is an ongoing process.
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
394
F100 TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
38. Commitments and Contingencies (continued)
Other ongoing lawsuits and tax investigations (continued)
In addition, following tax investigations which were started previous periods (i) prepaid card sales and
other transactions for 2017 fiscal year regarding SCT, (ii) 2018 fiscal year transactions regarding SCT,
Corporate Income Tax and Value Added Tax closing minutes have been signed and Central Commission
of Report Consideration meeting has been held. Evaluation of Commission is still going on.
In addition, in accordance with the "Contract for the Establishment and Operation of Mobile
Communication Infrastructure Service in Settlements Without Mobile Coverage" signed with the Ministry
of Transport and Infrastructure, since the fees reflected to the Ministry should be subject to special
communication tax and assessment has been made for the 2015 and 2016 periods. Application has been
made for the assessment on 11 December 2020 to benefit for the structuring provisions of the Law
No.7256 and the application has been approved. In this context, 51,174 TL was paid in March 2021 in
advance.
On the other hand, mobile payment services provided by Turkcell Odeme were investigated within the
scope of the Law No. 6493 and secondary legislation issued pursuant to this Law. As a result of the
investigation, an administrative fine was imposed on Turkcell Odeme in the amount of TL 18,763.
Turkcell Odeme filed a lawsuit for the cancellation of the aforementioned administrative fine. The hearing
was held on 30 December 2020 in this case. The Court decided to accept the case in favor of the Company
and cancelled the administrative fine subject to the case.
While this case was ongoing, the Tax Office sent a payment order for collection of the aforementioned
administrative fine. Turkcell Odeme filed a lawsuit for the cancellation of the payment order. The Court
accepted the case and cancelled the payment order. Tax office appealed the decision before the Regional
Administrative Court. The Company replied this appeal request in due time. The Regional Administrative
Court, rejected the appeal request of the Tax Office in favor of the Company.
Based on the management opinion, an outflow of resources embodying economic benefits is deemed as
probable on some of the aforementioned lawsuits and investigations, thus, TL 242,521 provision is
recognized in the consolidated financial statements as at and for the year ended 31 December 2020
(31 December 2019: None).
39. Related parties
Due to the change of the ultimate parent, the Group reevaluated the related party entities and reflected the
transactions on 31 December 2020 financial statements.
Transactions with key management personnel
Key management personnel comprise the Group's members of the Board of Directors, chief officers and
other directors.
There are no loans to key management personnel as of 31 December 2020 and 2019.
The Group provides additional benefits to key management personnel and contributions to retirement
plans based on a pre-determined ratio of compensation.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
39. Related parties (continued)
The following transactions occurred with related parties:
Revenue from related parties
Enerji Piyasalari Isletme A.S. (“EPIAS”) (**)
Turk Hava Yollari A.S. (“THY”) (**)
Turksat Uydu Haberlesme Kablo TV ve Isletme
A.S.(“Turksat”) (**)
Ziraat Bankasi (**)
Turkiye Vakiflar Bankasi TAO (“Vakifbank”) (**)
Borsa Istanbul A.S. ("BIST") (**)
Gunes Express Havacilik A.S. (“Sun Express”) (**)
Turkiye Halk Bankasi A.S. (“Halkbank”) (**)
Sofra Kurumsal ve Odullendirme Hizmetleri A.S. (“Sofra”)
Posta ve Telgraf Teskilati A.S. (“PTT”) (**)
Kredi Kayit Burosu A.S. (“KKB”) (**)
Sonera Holding
Kyivstar GSM JSC (“Kyivstar”) (*)
Telia Carrier Germany GmbH (“Telia Carrier”)
Vimpelcom OJSC (“Vimpelcom”) (*)
Other
Related party expenses
2019
-
-
-
-
-
-
-
-
-
-
-
772,436
27,050
12,934
6,191
7,004
825,615
2020
23,737
14,374
10,408
10,285
6,234
3,458
2,867
2,296
1,221
870
657
-
-
-
-
6,206
82,613
2020
80,689
25,477
14,023
3,654
1,682
EPIAS (**)
Sofra
Turksat (**)
Boru Hatlari Ile Petrol Tasima A.S. (“BOTAS”) (**)
PTT (**)
Kyivstar (*)
Telia Carrier
Vimpelcom (*)
Wind Telecomunicazioni S.P.A. (“Wind”) (*)
Turkcell Vakfi
Other
-
-
-
-
-
2,071
127,596
(*) Transactions with Vimpelcom, Kyivstar and Wind include transactions until 18 June 2019.
(**) Transactions with related parties through TVF BTIH include transactions as of 22 October 2020 and onwards.
2019
-
8,874
-
-
-
40,210
7,503
1,228
274
-
2,000
60,089
Details of the financial assets and liabilities with related parties as of 31 December 2020 and 2019 are as follows:
F101
2018
-
-
-
-
-
-
-
-
-
-
-
-
52,946
7,941
5,418
8,176
74,481
2018
-
-
-
-
-
77,174
6,047
2,751
4,812
44,247
9,878
144,909
395
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S
Short-term benefits
Termination benefits
Share based payments
Long-term benefits
31 December
2020
86,478
6,548
5,760
1,085
99,871
100
31 December
2019
78,775
56,720
6,247
653
142,395
31 December
2018
80,868
121
11,473
755
93,217
Banks - Time deposits
Banks - Demand deposits
Other cash and cash equivalents
Bank borrowings
Debt securities issued
Lease liabilities
101
31 December
2020
6,713,484
106,799
8,354
(55,902)
(50,866)
(65,577)
6,656,292
31 December
2019
-
-
-
-
-
-
-
Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
396
F102 TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F103
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
39. Related parties (continued)
Interest expense to related parties:
Halkbank
Ziraat Bankasi
Ziraat Yatirim Menkul Degerler A.S.
Other
2020
1,968
1,736
506
65
4,275
2019
-
-
-
-
-
2018
-
-
-
-
-
Revenue from related parties are generally related to telecommunication, call center and other
miscellaneous services. Transactions between the Group and EPIAS are related to the energy services;
transactions between the Group and Sofra are related to meal coupon services; transactions between the
Group and BOTAS are related to infrastructure services; transactions between the Group and Halkbank,
Ziraat Bankasi and Vakifbank are related to banking services; transactions between the Group and PTT
are related to cargo transportation; transactions between the Group and Turksat are related to
telecommunication services and transactions between the Group and BIST are related to stock market
services. Receivables from related parties are not collateralized.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
39. Related parties (continued)
As of 31 December 2020, the amount of letters of guarantee given to the related parties is TL 67,455
(31 December 2019: None).
Details of the time deposits at related parties as of 31 December 2020 are as follows:
Ziraat Bankasi
Vakifbank
Halkbank
Ziraat Katilim Bankasi A.S.
31 December
2020
2,338,812
2,307,202
1,904,505
162,965
6,713,484
Amount
796,073
610,140
28,838
Currency
USD
TRY
EUR
Effective Interest Rate
2.9%
17.4%
1.5%
Maturity
January 2021
January 2021
January 2021
Details of the bank borrowings at related parties as of 31 December 2020 are as follows:
Amount
49,993
Currency
RMB
Effective Interest Rate
5.2%
Maturity
June 2021
Details of the debt securities issued at related parties as of 31 December 2020 are as follows:
Amount
50,000
Currency
TRY
Effective Interest Rate
15.0%
Maturity
March 2021
31 December
2019
-
-
-
-
-
31 December
2020
5,843,574
610,140
259,770
6,713,484
31 December
2020
55,902
55,902
31 December
2020
50,866
50,866
Details of the lease liabilities at related parties as of 31 December 2020 are as follows:
Currency
EUR
TRY
USD
Effective Interest Rate
0.2% - 3.7%
12.8% - 26.8%
4.0%
Payment Period
2021 – 2024
2021
2023
31 December 2020
65,202
341
34
65,577
Interest income from related parties:
Ziraat Bankasi
Halkbank
Vakifbank
Other
2020
33,838
32,762
27,509
1,611
95,720
2019
-
-
-
-
-
2018
-
-
-
-
-
102
103
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Independent auditor’s report and consolidated financial statementsTURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
398
F104
TURKCELL ILETISIM HIZMETLERI AS
TURKCELL ILETISIM HIZMETLERI AS
F105
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
40. Subsidiaries
40. Subsidiaries (continued)
The Group’s ultimate parent company is TVF, while subsidiaries, associates and a joint venture of the
Company as at 31 December 2020 and 31 December 2019 are as follows:
Details of non-wholly owned subsidiaries that have material non-controlling interests in the Company are
disclosed below:
Subsidiaries
Name
Turktell
Turkcell Superonline
Turkcell Satis
Turkcell Teknoloji
Turkcell Gayrimenkul
Turkcell Enerji
Turkcell Finansman
Turkcell Sigorta
Turkcell Odeme
Lifecell Dijital Servisler (1)
Lifecell Bulut (1)
Lifecell TV (1)
Lifecell Muzik (1)
Global Tower
UkrTower
Beltower
Eastasia
Kibris Telekom
Lifecell Digital
Turkcell Global Bilgi
Global LLC
Rehberlik
Lifecell Ventures
Lifecell
Paycell LLC
Turkcell Europe
Yaani
BiP Digital (2)
BiP Iletisim (2)
Beltel
Belarusian Telecom
Lifetech
Inteltek (3)
Associates
Name
TOGG
Joint Venture
Name
Sofra
Country of
Incorporation
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Turkey
Ukraine
Republic of Belarus
Netherlands
Turkish Republic of
Northern Cyprus
Turkish Republic of
Northern Cyprus
Turkey
Ukraine
Turkey
Netherlands
Ukraine
Ukraine
Germany
Netherlands
Netherlands
Turkey
Turkey
Republic of Belarus
Republic of Belarus
Turkey
Country of
Incorporation
Turkey
Country of
Incorporation
Turkey
Business
Information technology, value added GSM services
and entertainment investments
Telecommunications, television services and content
services
Sales, delivery and digital sales services
Research and development
Property investments
Electricity energy trade and wholesale and retail
electricity sales
Consumer financing services
Insurance agency activities
Payment services and e-money license
Development and providing of digital services and
products
Cloud solutions services
Online radio, television and on-demand streaming
services
Radio, television and on-demand streaming services
Telecommunications infrastructure business
Telecommunications infrastructure business
Telecommunications infrastructure business
Telecommunications investments
Telecommunications
Telecommunications
Customer relations and human resources management
Customer relations management
Directory assistance
Telecommunications investments
Telecommunications
Consumer financing services
Telecommunications
Internet search engine and browser services
Providing digital services and products
Providing digital services and products
Telecommunications investments
Telecommunications
Information technology, programming and technical
support
Information and entertainment services
Business
Electric passenger car development, production and
trading activities
Business
Meal coupons and cards
Effective Ownership Interest
31 December
2020 (%)
31 December
2019 (%)
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
80
80
-
100
100
100
100
100
100
100
100
100
-
-
-
-
100
100
100
100
100
100
100
100
100
100
100
100
100
100
-
100
100
80
80
55
Effective Ownership Interest
31 December
2020 (%)
31 December
2019 (%)
19
19
Effective Ownership Interest
31 December
2020 (%)
33
31 December
2019 (%)
33
Place of
incorporation
and principal
place of business
Proportion of ownership
interests and voting rights
held by non-controlling
interest
31
December
2020
31
December
2019
Profit/(loss) allocated to
non-controlling interests
31
December
2020
31
December
2019
Accumulated non-
controlling interests
31
December
2020
31
December
2019
Name of subsidiary
Individually immaterial
subsidiaries with non –
controlling interest
Inteltek
Turkey
-
45.00%
2,534
-
2,534
21
30,182
30,203
171
-
171
148
36,307
36,455
Summarized financial information in respect of Inteltek is set out below. The summarized financial information
below represents amounts before intragroup eliminations.
Inteltek
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity attributable to owners
Revenue
(Expenses) / Income (net)
Gain on Sale of Investments
Profit for the year
Other comprehensive income/(loss) for the year
Dividend paid to non-controlling interests
Net cash (outflow)/inflow from operating activities
Net cash inflow from investing activities
Net cash outflow from financing activities
Effects of foreign exchange rate fluctuations on
cash and cash equivalents
Net cash (outflow)/inflow
31 December
2020
31 December
2019
-
-
-
-
-
2020
-
-
-
-
-
-
-
-
-
-
-
84,896
6,516
6,286
4,444
80,682
2019
141,783
(74,711)
-
67,072
640
(125,027)
(63,238)
20,001
(277,837)
14,979
(306,095)
(1) On 28 February 2020, Lifecell Dijital Servisler, which will develop and provide digital services and products, was incorporated by Turktell, a subsidiary of the Group, under the laws of
Republic of Turkey. On 21 April 2020, Lifecell Bulut, which will provide cloud solutions services, Lifecell TV, which will provide online radio, television and on-demand streaming services
and Lifecell Muzik, which will provide radio, television and on-demand streaming services, were incorporated by Lifecell Dijital Servisler which is 100% owned by Turktell, a subsidiary of
the Group.
(2) On 21 July 2020, the trade name of TOFAS was changed to Lifecell Iletisim and its business activity is determined and announced as providing telecommunication services. On
7 September 2020, Lifecell Digital Communication Technologies B.V (“Lifecell Communication”), which will provide digital services and products, was incorporated by Lifecell Ventures, a
subsidiary of the Group. On 30 September 2020, 100% of the shares of Lifecell Iletisim were transferred to Lifecell Communication and the transaction was registered and announced as of 12
October 2020. The trade names of Lifecell Communication and Lifecell Iletisim were changed to BiP Digital and BiP Iletisim on 4 December and 14 December 2020, respectively.
(3) The Company has signed a definitive agreement on 29 July 2020 to transfer its total shareholding in Inteltek to other shareholder of aforementioned, Intralot Iberia Holding SAU. The
transfer of shares and proceeds were completed on 30 September 2020. The final value of the transaction is realized as TL 6,063. Subsequently, the Company loses its control over Inteltek.
This transaction has no material effect on the Group’s financial statements.
Inteltek operated games of chance and assigned mobile sub agencies to operate the fixed odds and paramutual
betting games basing on the agreements executed with Spor Toto. The term of the agreement executed between
Spor Toto and Inteltek has been expired on 29 August 2019. In this context, activities of Inteltek ceased on
29 August 2019. The Company has signed a definitive agreement on 29 July 2020 to transfer its total
shareholding in Inteltek to other shareholder of aforementioned, Intralot Iberia Holding SAU. The transfer of
shares and proceeds were completed on 30 September 2020 (Note 40).
104
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400
F106
TURKCELL ILETISIM HIZMETLERI AS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at and for the years ended 31 December 2020
(All amounts disclosed in the consolidated financial statements and notes have been rounded off to the nearest
thousand currency units and are expressed in Turkish Liras unless otherwise stated.)
41. Cash flow information
Net financial liabilities reconciliation:
Debt
securities
issued
(5,965,790)
(494,987)
885,647
(1,787,424)
(7,362,554)
Debt
securities
issued
(5,210,562)
(311,649)
563,241
(1,006,820)
(5,965,790)
Balance at 1 January 2020
Cash inflows
Cash outflows
Other non-cash movements
Balance at 31 December 2020
Balance at 1 January 2019
Cash inflows
Cash outflows
Other non-cash movements
Balance at 31 December 2019
42.
Subsequent events
Loans
(12,806,882)
(22,983,201)
26,817,471
(3,152,370)
(12,124,982)
Lease
liabilities
(1,533,055)
-
1,302,335
(1,868,166)
(2,098,886)
Total
(20,305,727)
(23,478,188)
29,005,453
(6,807,960)
(21,586,422)
Derivative
Assets, net
758,896
2,085,585
(866,650)
(1,179,505)
798,326
Total
(19,546,831)
(21,392,603)
28,138,803
(7,987,465)
(20,788,096)
Loans
(13,531,027)
(29,060,490)
32,003,647
(2,219,012)
(12,806,882)
Lease
liabilities
(1,413,956)
-
1,215,320
(1,334,419)
(1,533,055)
Total
(20,155,545)
(29,372,139)
33,782,208
(4,560,251)
(20,305,727)
Derivative
Assets, net
1,190,797
1,924,363
(1,101,876)
(1,254,388)
758,896
Total
(18,964,748)
(27,447,776)
32,680,332
(5,814,639)
(19,546,831)
On 8 January 2021, the Group announced that its subsidiary, Turkcell Odeme, shall issue management
agreement based lease certificates in accordance with capital markets legislation through an asset leasing
company at an amount of up to TL 200,000, with maturities up to 12 months, in the domestic market, in
one or more tranches, without public offering, as private placement and/or to be sold to institutional
investors.
In accordance with the resolution of TOGG’s board of directors, the Group made capital advance
payments to TOGG amounting to TL 103,626 in January, February and March 2021.
On 15 April 2021, the Company’s General Assembly has approved a dividend distribution for the year
ended 31 December 2020 amounting to TL 2,585,787; this represents a gross cash dividend of full TL
1.17536 per share. The dividend will be paid to the shareholders in three instalments on
30 April, 30 July and 27 October 2021.
On 22 April 2021, a temporary article is added to the Turkey’s Corporate Tax Law No. 5220 which was
published in the Official Gazette. The Law increases the corporate tax rate under Corporate Tax Law from
the current 20% rate to 25% for the tax year 2021 and to 23% rate for the tax year 2022; the change took
effect on the Law’s date of publication. It is expected to continue with 20% afterwards.
106
Our Offices
Location
Address
ADANA PLAZA
Turhan Cemal Berikel Bulvarı No: 212 Seyhan Adana
ANKARA PLAZA
Eskişehir Yolu 9.Km.No:264 Pk:06510 Söğütözü Ankara
ANKARA DC
Turkcell Ankara Veri Merkezi Malıköy Anadolu OSB Mahallesi 12. Cadde Sincan / ANKARA
ANTALYA PLAZA
Kızıltoprak Mah. 915 Sok. No:3 Muratpaşa Antalya
BAŞKENT NDC
Başkent İvedik Mahallesi 1323. Cadde No:37 Yenimahalle Ankara
BEYOĞLU FLAGSHIP
Meşrutiyet Caddesi No 71 Beyoğlu İstanbul
BORNOVA NDC
Kazım Dirik Mah. 367/7 Sokak No:12 Bornova İzmir
BURSA PLAZA
ÇORLU NDC
Organize sanayi Bölge Müd. Kırmızı Cad. No:4 Nilüfer Bursa
Yulaflı Mah. Hacı Şeremet Mevkii Karin-Balin Gıda Fb. karşısı Çorlu Tekirdağ
DAVUTPAŞA NDC
Maltepe Mah Davutpaşa Cad. Serçekale Sok. No2 Zeytinburnu-İstanbul
DİYARBAKIR PLAZA
Urfa bulvarı Bağcılar Mah No 184 Turkcell plaza bağlar Diyarbakir
DUDULLU DC
EDİRNE DC
Dudullu OSB Nato Yolu 4. Cadde No:1 Ümraniye-İst
Şükrü Paşa Mah. Kıyık Cad. Hilly Otel Yanı No254 Edirne
ERZURUM NDC
Ilıca yolu Organize sanayi bölgesi 4.Sok Erzurum
GAZİANTEP NDC
Kocaoğlan Mah. Demokrasi Bulvarı no:185 / 1 Şahinbey Gaziantep
GEBZE DC
HATAY NDC
İZMİR PLAZA
İZMİR DC
İZMİT NDC
Gebze OSB, Tembelova Mevkii Mah. 3300 Sok. No: 3314 Gebze-Kocaeli
Güzelbirlik Mah. Yunus Emre Cad. No:11-B Güzelburç Hatay
Kazım Dirik Mah. 367/7 Sokak No:12 Bornova İzmir
İTOB 10005 sokak no:37 Torbalı - İzmir
Yahya Kaptan Mah. Bahçeşehir Sok. No :30 İzmit/Kocaeli
KARTAL PLAZA
Topselvi Mahallesi Dipçik Sokak No 31
KAYSERİ NDC
KONYA OFİS
KONYA NDC
Kayseri Organize Sanayi Bölgesi 13. Cadde No:16 Melikgazi- Kayseri
Parsana Mh.Zümrütova Sok.No:1 Selçuklu/Konya
Horozluhan Mah Sıhhıye Sok No:6 1.ORG SAN. Selçuklu Konya
KÜÇÜKYALI PLAZA
Aydınevler Mahallesi İnönü Caddesi No:20 B Blok 34854 Maltepe İstanbul
MAHMUTBEY NDC
Mahmutbey Mah İnönü Caddesi No: 89 Bağcılar İstanbul
MALATYA NDC
Hoca Ahmet Yesevi Mah. 7. Sok. Mahrukatçılar Sitesi No: 34 Merkez Malatya
MALTEPE PLAZA
Yeni Mah. Pamukkale Sok. No: 3 Soğanlık Mevkii - Kartal İstanbul
MERSİN NDC
MUĞLA NDC
SAKARYA OFİS
SAMSUN NDC
Portakal Mah. 80050 Sok. No:3 Toroslar \Mersin
Musluhittin Mahallesi Atatürk Bulvarı No:61 Muğla
Bahçelievler Mah. Cumhuriyet Cd. Kamelya Sk. No:16 Serdivan Sakarya
Mimar Sinan Mah. 160.sok.No:18 PK:55200 Atakum Samsun
TEKNOLOJİ PLAZA
Yenimahalle Pamukkale sok. No:11 Cevizli/Kartal
TEPEBAŞI PLAZA
Meşrutiyet Caddesi No 71 Beyoğlu İstanbul
TRABZON NDC
Mısırlı Mah. Hasan Turfanda yolu No:1 Çukurçayır Trabzon
VAN NDC
İpek yolu 8 km yeni mahalle sahil sokak no. 27 Edremit Van
401
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402
Group companies and other information
on corporate governance
Glossary
Abbreviation
Explanation
3G
4.5G
5G
6G
ARPU
Backhaul
Base Station
Beacon
C#
Carrier
Aggregation
CELTIC
DSS
ER
ESG
EUREKA
Gbps
GRI
GSM
GSMA
HD
ICTA
IDC
IMS
IoT
A third generation mobile telecommunication system established according to IMT-2000/UMTS
standards, or standards developed based on these standards
A generation containing technologies of more advanced features than standard 4G technology
A generation containing technologies having more advanced features than standard 4G technology
6th generation advanced communication technologies are expected to enter our lives in the 2030s in
the wake of 5G
Average monthly revenue generated per mobile subscriber
Wired/wireless communication technologies and tools that provide the connection between base
stations and the Core Network
A fixed transceiver device in each cell of a mobile communications network enabling communication
between mobile phones and radio signals within the cell
A location-based data provider utilized in My Dream Companion project
A Microsoft programming language developed for net technology
A technique allowing more bandwidth and consequently higher speeds to be obtained by joining
frequencies called carriers
EUREKA Cluster focusing on the Information and Communications Technology and
Telecommunications
Digital Service Provider
Integrated Reporting
Integrated Reporting Framework
Environmental, Social, Governance
(Exceptional Unconventional Research Enabling Knowledge Acceleration) It is an intergovernmental
R&D organization financed by governments of more than forty countries
A data transmission speed
Global Reporting Initiative
This is a digital mobile communication system, standardized by the European Communications
Standards Institute and based on digital transmission with roaming and the cellular network structure
being used in Europe, Japan and various other countries
(The GSM Association - Global System for Mobile Communications) The GSM Association is
a community consisting of mobile operators and telecom-related companies with the aim of
standardizing and developing the Mobile Telecommunications Sector
High Definition Broadcast
Information Communication Technologies Authority
(International Data Corporation) American market research company examine the development of
technology
(IP multimedia subsystem) Platform to provide a new generation of wired, wireless service providers
(Internet of Things) The mobilization, interpretation and communication/interaction of the data
received through sensors
Abbreviation
Explanation
IIRC
IT
ITEA
LTE
International Integrated Reporting Council
Tools for generating, collecting, accumulating, processing, recovering, disseminating, protecting, and
assisting
EUREKA Cluster program supporting innovative, industry-driven, pre-competitive R&D projects in the
area of Software-intensive Systems & Services
Technology that ensures to achieve very high speeds by combining carriers in the same or different
frequency bands
LTE-Advanced
A mobile communications standard comprising advanced features such as carrier coupling, which
enables mobile broadband speed of over 150 MBps in LTE
M2M
MHz
NB-IoT
NGMN
NPS
Roaming
RTM
SASB
Scratch
SDG
SD-WAN
SMS
Tbps
NGO
UN
UNGC
WEF
Machine to Machine is the general name of the technology that allows devices to exchange
information and conduct transactions without human intervention
(Megahertz) A frequency unit
A technology defined by 3GPP for Internet of Things
An organization (Next Generation Mobile Networks Association), of which Turkcell is a member,
and which several operators, suppliers and universities in the world are a part of, giving direction to
technology standards and technology producing companies in relation to operator requirements
(Net Promoter Score) The score that measures whether or not customers recommend the products
they use to others
A mobile communication feature that allows the subscribers of a network to use their cell phones and
numbers within the coverage of another operator
(Real Time Monitoring) 24/7 monitoring and reporting system on the system
Sustainability Accounting Oversight Board
Scratch is a programming language developed by MIT (Massachusetts Institute of Technology), which
has a user-friendly interface, designed for the use of children between the ages 8 and 16
Sustainable Development Goals
Acronym for software-defined networking in a wide area network (WAN)
A mobile communication system allowing users to receive and send messages that can be
constituted of both alphabetic and numerical characters of up to 160 characters, to and from mobile
phones through a short message service
(TeraBytes Per Second) One trillion bits or bytes per second
Non-Governmental Organisations
United Nations
United Nations Global Compact
World Economic Forum
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TURKCELL INTEGRATED ANNUAL REPORT 2020TURKCELL INTEGRATED ANNUAL REPORT 2020
Turkcell İletişim Hizmetleri A.Ş.
Turkcell Küçükyalı Plaza, Aydınevler Mahallesi
İnönü Caddesi No: 20 Küçükyalı Ofispark B Blok - Maltepe / İstanbul
Tel: +90 (212) 313 1000 Fax: +90 (216) 504 4058
Customer Services Tel: 532 or +90 (532) 532 0000
www.turkcell.com.tr
Trade Register Number: 304844
Report Consultancy
KPMG Turkey Sustainability Team
www.kpmg.com.tr
Graphic Design
Günce Reklam
info@guncereklam.com
Printed Matter
myclimate.org/01-21-444873
Continue reading text version or see original annual report in PDF
format above