Ladies and gentleman, thank you for standing by. Welcome to the Third Quarter 2012 Results Announcement Conference Call on the 19th of October 2012. Throughout today’s recorded presentation, all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask questions. (Operator Instructions) I’ll now hand the conference over to Koray Özturkler. Please go ahead, sir. Koray Özturkler: Thank you, Ken. I’d like to welcome everyone here on behalf of the Turkcell management team. We’ll quickly start the presentation. Before the presentation, as far as the procedure, I’d just like to give you the quick notice that this presentation may contain some statements that are forward-looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties, which may cause actual results to differ materially due to factors discussed in this presentation. Please also note that all financial data are consolidated, whereas non-financial data are unconsolidated, unless otherwise specified. Now, we can begin with the presentation of Mr. Ciliv. Süreyya Ciliv: Good afternoon and welcome to Turkcell’s third quarter of 2012 results call. In the quarter, we have generated the highest quarterly revenue, record revenue in our history. Turkcell Group revenues rose by 9% year-on-year and 7% quarter-on-quarter to TRY2.8 billion. While improving our top line, we sustained a profitable business model. In nominal terms, our EBITDA rose year-on-year to TRY912 million with an EBITDA margin around 33.1%. This strong operational performance and higher interest income raised our net income to TRY571 million, including the TRY72 million impairment due to A-Tel, the details of which will be discussed in our financial review section. At Turkcell Group, we performed better in the third quarter. And based on our year-to-date performance of 11% revenue growth and 8% EBITDA growth, we now…

Thank you, Mr. Ciliv. Good morning and good afternoon to all participants. I will now talk about our financial performance in more detail. During the third quarter, group revenues rose by 9% year-on-year, reaching a record high of TRY2.6 billion. TRY100 million of increase was generated by our subsidiaries. The 4% rise in the voice revenues plus 12% growth in mobile broadband and service led TRY226 million in Turkcell Turkey’s contribution. Compared to a quarter ago, group revenues were up 7% with Turkcell Turkey being the key driver. Quarter-on-quarter, Turkcell Turkey’s revenue rose by TRY150 million of which majority was generated by our voice business. Our mobile broadband and services business increased by its contribution by TRY44 million and a further TRY37 million was contributed by our subsidiaries. Moving on to page 14 EBITDA slide. Quarterly EBITDA increased in nominal terms by 5%, while its margin fell to 33.1% from the same period of last year. This was mainly due to the high direct cost of revenues and general and administrative expenses, which were partially offset by decreased selling and marketing expenses. As a percentage of consolidated revenues, direct cost of revenues excluding depreciation and amortization rose by 3.1 percentage points year-on-year. This mainly stems from the 2.3-percentage point higher interconnection cost due to further increase of net traffic in Turkey. General and administrative expenses as a percentage of revenues rose year-on-year by 0.5 percentage points mainly due to increased net debt expenses. Selling and marketing expenses as a percentage of revenues fell year-on-year by 2.2 percentage points to 14.5%. This mainly arose from lower acquisitions and one-off decline in distributor-dealer related expenses. Compared to the previous quarter, EBITDA in nominal terms increased by 17% and the EBITDA margin rose by 2.7 percentage points. This was chiefly due to the…

Thank you sir. (Operator Instructions) Thank you. The first question comes from Alex Wright. Please go ahead. Alex Wright – UBS: Yeah, thank you very much, and good afternoon. Had a couple of questions please on the gross margin. Obviously your interconnect revenues and costs have been growing quite strongly and it looks though this quarter they’re more or less in line with each other whereas for most of the last two or three years your interconnect revenues have been lower than your costs. So do you think that now we should expect this interconnect balance to be approximately zero or potentially even become positive. And on some of the other gross margin drivers, I understand your network related expenses have also been growing quite strongly, do you expect these to continue to grow as a percentage of revenue over the coming few quarters over yet. Thank you. Süreyya Ciliv: Murat will take this question.

This is Murat speaking. Related to the interconnection cost increase and their trend in the next few quarters, we are anticipating that the ratio onto the interconnection cost is going to be maintained at that levels. You will remember that due to the significant MTR costs and the market condition, we have been a net interconnect payer since 2010. Due to increasing revenue, incoming revenues together with the international MTR regulation, we reached to a breakeven end of this quarter. And from now on we anticipate the trend is going to be on the same level. Alex Wright – UBS: Thank you.

Thank you. The next question comes from Hervé Drouet. Please go ahead. Hervé Drouet – HSBC: Yes, good afternoon. Is there any update on your side about appointment of Independent Directors, anything new since the last time that may move, any decision on the dividend payments? Süreyya Ciliv: No, we don’t have any new information on that subject. Hervé Drouet – HSBC: All right. Anything you will expect, is there any timelines we can expect, who have been publicly said? Süreyya Ciliv: No. I really don’t have any new information. I think the situation – there is no new information. Hervé Drouet – HSBC: Okay. All right. Thank you.

Thank you. The next question comes from San Dhillon. Please go ahead. San Dhillon – Barclays: Hey, guys. Just a couple of questions. On Superonline, and I apologize if this question has been asked earlier. What are your future rollout plans, when you look to penetrate the footprint you have now or would you like to continue to grow the footprint to beyond the 1.2 million homes? And the second question on wireless, I suppose that interconnection revenue is becoming a increasing proportion of the service revenue number, I believe it’s around 13%. I guess it makes you more vulnerable to any future MTR cuts, I mean what are you hearing on MTR, do you think there is a risk that they go down further from here? Thanks. Süreyya Ciliv: We did make, in our opinion, significant CapEx investment. I think from now on, it is going to – we are going to slowdown this investment and we will understand the strategy by the regulator about the fiber optic rollout in the country. And we will look for better optimized, more cooperative strategy between us, Turkish Telekom, and other partners – other players in the market. So we did have – we did make significant progress at investments in the last four years. This gave us a strong base. I think the investments will slowdown. And we will monitor the strategy to be developed for the country among all players. Koray Özturkler: As for the second question, I’ll try to respond to that. This is Koray. In terms of interconnection revenues, we don’t expect major change on the revenue stream from interconnect. Your question was towards MTR rate cut. We see that MTR rate cuts have been – have taken place and we have pretty low MTRs in Turkey. We…

Thank you. We have a follow-up question from Alex Wright. Please go ahead. Alex Wright – UBS: Yeah. Thank you. I just wanted to follow-up on my earlier question. You commented on the interconnect revenue and costs, and I just wanted to ask about the network-related expenses as well which have risen strongly over the last year, and what you think that (inaudible)? And then secondly on the sales and marketing costs, which came down quite a bit in the third quarter, as you explained in the release part of that reduction was due to some one-off changes in the treatments of distribution expenses through A-Tel. Can you just explain in a little bit more detail about the one-off nature of that reduction please, is it a permanent one-off reduction or to mean that there’s a temporary nature to that reduction which will potentially be reversed in future? Thank you. Süreyya Ciliv: Okay. On the network side, I think Alex, you and everybody should be – should remember that we started our 3G operation about three years ago. So we still have an increasing investment of 3G that we are going through. And also some of our rent prices – rents are based on dollars and also energy costs are rising. So, at the same time, the data traffic is increasing sharply and we want to maintain our major differentiation with other operators in quality of service in coverage, in drop rates and also mobile Internet speed. So we want to continue our competitive advantage. As a result we have to continue our investment, but at the same time we are launching key efforts in – how do we reducing – how we can reduce our costs. And some of this also will include cost sharing projects with other operators as well. So maintain – optimizing our network costs while we continue to build our network and maintain our differentiation will be top priorities. We are aware of these costs and we will optimize them. Alex Wright – UBS: (Inaudible) on that note, have you considered any outsourcing options at all or do you think that it’s not really viable? Süreyya Ciliv: Yes, we have considered. And we are actually doing it, but the company we outsource to is our company, called Global Tower. And we expect other operators to use outsourcing, infrastructure sharing projects with us through this company. So this company has been providing service to our network and also providing some service to Vodafone and it is starting to provide services to Avaya. And they really act as a third-party with servicing quality and I’m encouraged by the reception I hear from other operators about the service quality that they deliver. So, our company, Global Tower is the company that we are looking at for the really benefit of the marketplace for all operators to bring the cost down. Alex Wright – UBS: Okay, thank you. And regarding the sales and marketing costs?

Yes. Hi, Alex. This is Murat. I’m going to answer this S&M related site. Traditionally, the S&M expenses as a percentage of revenues tend to perform lower due to the higher revenues generated in the third quarter. Keeping that on the side, there are three main components for explaining the third quarter’s S&M performance. The first one is the prepaid frequency usage piece. You will remember that we start charging them to the prepaid customers as well. So there has been a decrease on the prepaid frequency usage fees. There is a positive effect on our S&M expenses. Second on the marketing expenses side, there has been a slight increase due to lower mark on spending in the last year same period. So – but the main differentiating one-off effect has been on the selling side and there are three contributors for the selling side improvement. The first one being, while we were entering the third quarter, we started the quarter with a higher market stock ahead of the summer season. So we had a higher stock in the market. Second, we paid lower dealer premiums due to lower postpaid acquisitions, which are the highest contributors for us. And the third one is the decline in revenue sharing fees, which are due to A-Tel annulment. So these are the three components that I can explain the S&M expenses. Alex Wright – UBS: Okay. Thank you. And just so that I can be sure about the one-off nature of the A-Tel – the A-Tel fees that you mentioned, when you say that this is a one-off reduction, do you mean that it’s a permanent one-off reduction?

Related with the A-Tel’s one-off-effect, the effect is going to be in the long term positive for the company’s results on the operations. But, going forward, we are anticipating the S&M expense is going to be similar on to the revenue side. Alex Wright – UBS: Okay. Thank you very much.

Thank you. The next question comes from Alexandra Serova. Please go ahead. Alexandra Serova – Renaissance Capital: Good evening. I have a couple of questions. First, how do you see your margins in Turkey and Ukraine in 2013? Do you expect them improve – improving or what and do you see that it is possible to improve them or in just cost cutting or you think that some price increases are possible? And the second one is, on voice revenue, do you expect it to grow going forward on rate increase in product based subscribers more? Thanks. Koray Özturkler: Alexandra, hi. This is Koray. As per the guidance 2013, although we think it is a bit early, because we have still progressing. Although we are progressing, we haven’t completed the process. We expect a good year for 2013. We are going to grow in terms of revenue and EBITDA. We are looking for profitable growth. But I don’t – we don’t want to make at this point percentage of growth and margin. Things are going very well in Ukraine right now. They will continue to grow. They already have a quite strong margin. We will see what we can do, but I think we need a bit more time to be more definitive on the guidance points. Süreyya Ciliv: But there is – there is actually a – we are confident that from operational excellence and innovation point of view, we’ll continue to deliver a strong user experience versus competition. But, there is also a devaluation risk, and there is a risk with economy in Ukraine after the elections. And, obviously, we – and that would have an impact on our U.S. dollars revenues and Turkish lira conversion of those revenues. And so for 2013, slower growth is expected in the economy in Ukraine. Okay? Alexandra Serova – Renaissance Capital: Thanks. And about voice revenues in Turkey and margin in Turkey. Süreyya Ciliv: Voice revenues – yeah.

Voice revenues is an important part of our overall growth strategy. So we will keep on growing the voice revenue year-over-year. However, there’s a seasonality effect. So I mean, going forward in Q4, we might expect some decrease due to seasonality. Süreyya Ciliv: But as a business strategy we are planning – our strategy is about growing our voice revenues in 2013 as well.

Thank you. There appear to be no further questions. Please continue with any other points you wish to raise. Süreyya Ciliv: Well, thank you very much for actually participating to the conference call. At this time, we don’t have further comments. I do like to mention that please get in touch with myself or the IR team for follow-up questions and also remember that the audio recording of the conference call is available for you for the next two weeks. Thank you on behalf of the management team. Bye-bye. Thank you.

Thank you. This concludes the third quarter 2012 results announcement conference call. Thank you for participating. You may now disconnect.