Folding Box Board Investment Plan

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Regarding investment opportunities in the production of Folding Box Board - FBB (Carton or commonly known in the market as “Bristol Board”), the company has decided to issue the following statement in accordance with the Capital Markets Board’s ‘Material Events Communiqué (Communiqué)’ No. II-15.1 and ‘Material Disclosures Guidelines (Guidelines)’ and ‘Doğan Şirketler Grubu Holding A.Ş. Disclosure Policy’:

Doğan Dış Ticaret ve Mümessillik A.Ş. (Doğan Dış Ticaret), a wholly owned subsidiary of our company, has operated for nearly 30 years in the field of paper and board supply with significant know-how and experience, and currently serves as a representative of several foreign manufacturers. Aiming to leverage this extensive know-how and experience, our company has been seeking investment opportunities in paper and board raw materials, which are mostly sourced from international markets and imported into Turkey.

In consideration of the assessments conducted for this purpose, the Board of Directors has resolved on 17.03.2022 (today) to authorize and assign responsibility to the company management to:

1.     Draw up an investment plan for the production of Folding Box Board (FBB) from primary fiber and wood pulp, and

2.     Determine the operational and technical requirements for such an investment and also address the financial aspects of such a project/investment.

FBB is used in producing boxes that require high print quality and strength. The initial feasibility studies have shown that FBB consumption in Turkey in 2021 amounted to approximately 300,000 tons, all sourced from international markets. In view of the current market dynamics and the product’s potential, an investment in production for an annual capacity of approximately 500,000 tons in integration with a pulp plant (bleached chemi-thermomechanical pulp - BCTMP) can be expected to make a positive contribution to the current account deficit of our country by reducing the need for imports and creating a potential for exports. Once a final decision is made, the investment is estimated to be completed in about three years. Furthermore, such an eco-friendly investment with low carbon emission should contribute to our company's and the global sustainability goals.

The investment plan outlined herein requires long-term planning in terms of financial, operational, legal, social, environmental, etc. aspects. Regardless of our company's plans and targets, various local and international risks (political, geographical, economic, etc.) may lead to significantly different actual outcomes compared to the anticipated results.