Risks That May Be Encountered
As a result of changes in Interest Risk Interest rates, an increase in the Company's financing expenses may occur. The Company manages interest risk by creating a portfolio of financial assets and liabilities with a balanced interest structure.
In order to manage the interest risks that our company is exposed to, the stoppage is calculated based on the loan portfolio and cash flow projections and the gains/losses to be experienced in possible interest changes are measured by sensitivity analysis.
Market / Price Risks
The company is exposed to price change risks due to the fluctuations in raw material and exchange rate prices, which are the production inputs due to the sector in which it operates, the fluctuations in the product price, which is the production output, and the fact that it operates in the production of products that should be subject to rapid consumption in the retail sector.
Exchange Rate Risk
In sales, collection and payment transactions (credit repayments, supplier payments, energy payments, other payments, etc.) carried out by the Company, it is exposed to exchange rate risk if they are made with currencies other than functional currency.
The basic approach of the Company in exchange rate risk management is to manage the exchange rate risk arising from the related transactions through derivative transactions with the help of appropriate financial instruments in transactions carried out outside the functional currency.
In order to increase its efficiency, our company makes high-cost investments to increase capacity in order to incorporate constantly developing production technologies and to meet the increasing demand. While some of these investment costs are covered by sales revenues, some of them are provided by financial markets. In the absence of proper planning, financial obligations may not be met in a timely manner, adequately and cost-effectively. For this reason, the company manages its liquidity needs by monitoring loan use and repayments and cash flow projections.
The company has established a liquidity risk management structure suitable for short, medium and long-term funding and liquidity requirements. The Company manages liquidity risk by regularly monitoring estimated and actual cash flows and ensuring the continuation of adequate funds and borrowing reserves through matching maturities of financial assets and liabilities.