Gündoğdu Food/Tokgöz: 2025 Will Be Our Year of Investment
Foreks - Gündoğdu Gıda (IS:GUNDG) Board Member and CEO Hakan Tokgöz stated that the company is progressing according to its 2024 objectives, saying, "We have achieved growth both in our sales revenues and in our operational profitability. The year 2025 will be a year when we strengthen our goal of providing sustainable growth and profitability to our investors."
Gündoğdu Gıda Board Member and CEO Hakan Tokgöz answered questions from Foreks News Editor Şenay Toluay. Tokgöz indicated that increasing production efficiency, standing out in the market with innovative products, and gaining a cost advantage through energy projects are among the company's main priorities for 2025. He stated, "Corporate governance, transparency, and sustainable growth will continue to be the cornerstones of Gündoğdu Gıda's strategy. The public offering process will create a significant leverage effect in the continuity of this strategy, enabling us to reach our goals faster in 2025."
Tokgöz also pointed out that one of their 2025 goals is to take their products to global markets, stating, "2025 will be an investment year for us."
The full interview is as follows:
"You are one of the youngest companies on Borsa Istanbul. Can you tell us about Gündoğdu Gıda?
Gündoğdu Gıda has a history that dates back to 1975. It started its business in wholesale food trade in Unkapanı and became a joint stock company in 2008. The cheese production facility, which was established in Manisa Salihli in 2009, has been in operation since 2011. We produce cheese in our factory, which is 15,000 square meters in size. When we first started production, we had approximately 3 tons of milk per day. Now, we have continuous production that processes 180 tons of milk daily. Currently, we continue to add value to the food sector with our production facility located in Manisa Salihli, our milk collection center in Ödemiş, and more than 200 employees.
How have you evaluated the revenue from the public offering, and can you briefly summarize where you stand since the offering?
Since our establishment, we have gained the trust of our consumers with our farm-to-table quality understanding and grown entirely with equity capital. Our public offering attracted significant interest from our investors. According to data shared by Borsa Istanbul, the total amount of demand for shares with a nominal value of 35,380,927, which corresponds to 3.53 times the number of shares offered at 10,000,000 units, reached 1,238,332,445 TL based on total unfiltered data in the public offering. As a result of the distribution, 10,000,000 nominal value shares were sold to 599,321 investors. Our total public offering size was 350,000,000 TL.
Of course, it has only been a short time since our public offering. We are very pleased with the interest that investors have shown in Gündoğdu Gıda. When we look at the figures, we see that we closed the first nine months of the year with a net profit of 3 million 819 thousand 598 TL, while our revenue during the same period was 1 billion 625 million 276 thousand 286 TL.
As stated during the public offering period, we are primarily using the revenue obtained from the public offering to strengthen our working capital.
Do you have plans for new investments, capacity increases, or acquisitions?
In the food industry, alongside increasing demand, we are also facing changing consumer preferences. It is no longer sufficient for food companies to simply expand our product range for competitive resilience. We realize that we must also provide innovative solutions. We are creating this difference with our varieties of cheese. We add a wide range of flavors from tarama cheese to gouda and cheddar cheese to supermarket shelves and the menus of our partners. One of our targets for 2025 is to take these flavors to global markets. Currently, we are present on the shelves of many national supermarket chains, including MacroCenter and BİM (IS: BIMAS), as well as local markets. At the same time, we are collaborating with major restaurant and pizza chains, mainly Turkish Airlines (IS: THYAO). E-commerce is another aspect of our business.
2025 will be an investment year for us. Additionally, we will be producing IQF mozzarella. We are completing our investment in production lines for this. Mozzarella is just one example; we aim to strengthen our position in the cheese market with different products in the future.
You previously stated that you did not see opportunities in the short term for exports. Do you still hold the same view? Can you provide information about your perspective on exports and your plans or timelines for execution?
To respond to the increasing demand in the food sector and changing consumer preferences, we continuously expand our product range and continue to offer innovative solutions. Our main goal is to bring Gündoğdu Gıda products to global markets and introduce our flavors to the entire world. In short, we are working hard to see our strength in the domestic market reflected in export markets as well.
How has inflation accounting affected you?
As Gündoğdu Gıda, we have no loan debts and conduct our operations entirely with our equity capital. This robust financial structure allows us to more clearly and strongly observe the effects of inflation accounting practices on our company. Inflation accounting ensures that our financial statements are updated according to current economic conditions, revealing the real values of our assets and liabilities. This enables us to monitor the financial health of our company more clearly and to make strategic decisions with greater confidence based on these data.
Looking at our financial results for the third quarter of 2024, we have achieved sales amounting to 1,625,276,286 TL. During this period, our operating profit increased by 17%, reaching 90,410,690 TL. This increase is a significant indicator that our operational efficiency and profitability have improved sustainably.
Thanks to inflation accounting practices, we are ensuring that these financial achievements are reported more accurately and transparently. This allows us to establish more reliable and healthy communication with our internal and external stakeholders. Working with our equity capital provides us flexibility, while inflation accounting gives us the opportunity to manage this strength more effectively. Thus, we aim to strengthen our position in the industry while increasing our internal efficiency by building our growth strategies on more solid foundations.
What is the latest status of the solar power system to be installed on the roof of the production facility? How will it benefit your balance sheet?
The solar power plant (GES) project to be installed on the roof of our production facility is an important step within the framework of our sustainability strategies. This project will help reduce our energy costs while also contributing to environmental sustainability. In addition to our ongoing rooftop GES project, we are also preparing to launch the land-based GES project we have recently completed. This system is scheduled to begin energy production at the beginning of the new year.
Significant progress has been made in the rooftop GES project, and work is continuing according to the project schedule. With this project, we aim to cover a significant portion of our energy consumption from renewable sources, thereby further reducing our energy costs. Our goal is to bring the rooftop GES project into operation in the first half of next year. Thus, we will maximize our energy production capacity with both our land and rooftop GES projects.
Creating sustainable value for our investors is one of our primary goals. While achieving our targets, we will continue to enhance energy efficiency, reduce water consumption, and support our local producers as part of our company's priorities in environmental and social sustainability within our production processes. We believe that with this approach, we can significantly raise our contributions to both the environment and society. Our investments in GES I mentioned earlier are leading our investments for energy efficiency, and by completing this investment, a significant portion of our factory's daily energy demand will be met with renewable energy.
Another significant resource for us is water, as our industry has very high water usage. For approximately 1 kg of cheese production, we use about 10-12 liters of water. Moreover, this figure does not include the water used in milk production, livestock farming, and agriculture. At this point, we clearly see the importance of innovative agricultural models and irrigation methods. In this regard, we are conducting studies in the regions where we operate, especially in Ödemiş.
We also continue to support our local producers in terms of sustainability. We work with our farmers on a contract basis; more importantly, we support cooperatives. Through this, we stand by them economically and help them to see their way forward while also aiding them in producing correctly.
These investments will have numerous direct and indirect benefits for our balance sheet. Firstly, the decrease in our energy costs will directly reflect positively on our operating profitability. Additionally, producing our own energy will help protect us from fluctuations in energy prices and strengthen our financial stability. Furthermore, investments in renewable energy will support our compliance with environmental, social, and governance (ESG) criteria and provide significant improvements in our sustainability reports. This will also enhance our company's reputation among investors and financial stakeholders.
In conclusion, with the completion of our land GES project and the rooftop GES project we are about to implement, we will achieve significant gains in terms of cost savings on energy, risk reduction, and reputation management. These investments will make a strong contribution to our company’s growth strategies in terms of both environmental and financial sustainability.
How will you use the resources obtained from the capital increase decision you made?
As Gündoğdu Gıda, we plan to effectively utilize the funds obtained from the capital increase in line with our strategic priorities. Initially, we aim to use 25% of the funds for the purchase of raw milk, which is our main input, to strengthen our supply chain. Furthermore, we plan to evaluate 50% of the funds in feed purchases to gain cost advantages and support our producers. Initially, it was planned that 25% of the funds would be used in the purchase of consumables such as packaging and boxes used in production. However, since it is anticipated that these expenses will not be completed in the short term, this portion will be used for our working capital need. This strategic allocation will enhance our operational efficiency while also strengthening our financial structure.
Have you met your 2024 targets, and what are your expectations for 2025?
We are closing half a century in our success story. The year 2024 has been a strategic year for Gündoğdu Gıda both financially and operationally. The public offering process we conducted this year not only provided a source of financing but also made significant contributions to our goals of corporate governance and transparency. With the resources obtained from the public offering, we have focused on investments that will increase our operational efficiency and production capacity.
When we look at the figures, we can easily say that we are progressing according to our 2024 targets. We have achieved growth both in our sales revenues and in our operational profitability. In particular, the increase in our operating profit stands out as a result of the correct strategies. Our GES projects, which we plan to implement within the year, and our effective cost management policies have been significant factors supporting this growth.
Regarding our expectations for 2025, we plan to see the main effects of the public offering process this year. With this process, we have achieved a stronger financial structure and increased our investment capacity. The year 2025 will be a year when we strengthen our goal of providing sustainable growth and profitability to our investors. Our fundamental priorities include further increasing our production efficiency, standing out in the market with innovative products, and gaining cost advantages through our energy projects.
Corporate governance, transparency, and sustainable growth will continue to be the cornerstones of Gündoğdu Gıda's strategy. The public offering process will create a significant leverage effect in ensuring the continuity of this strategy, allowing us to reach our goals faster in 2025. With our robust financial structure, effective resource management, and long-term growth objectives, we will continue to create sustainable value for our investors."