ÇATES ELEKTRİK ÜRETİM A.Ş. Özel Durum Açıklaması (Genel) 5 Mart 2025

The primary reason for the 3,430 million TL loss figure in our company's balance sheet as of December 31, 2024, is the 'Expenses from Investment Activities' item, a non-cash element amounting to 4,525 million TL in the income statement. This item reflects the decrease in value compared to the previous period resulting from the company valuation of power plant assets and does not create any negative impact on the company's operational activities.

One of the most important reasons for the valuation loss expenses is the negative gap between the USD/TL exchange rate and the CPI, which became significant with inflation accounting, a practice specific to the relevant period. While the USD/TL parity, which is the basis for the Turkish Lira equivalent of power plant assets valued in US Dollars, increased by 20% compared to the previous year, the CPI used to update the previous year's valuation in inflation accounting was 44%. In other words, in our inflation-adjusted financial statements, the balance sheet amounts for the previous year are reported by being increased by 44%.

Another reason is the fluctuations in macroeconomic assumptions and energy prices. There was a negative difference between the energy prices and expectations that were the basis for the valuation studies used in the financial statements of December 31, 2023, and the energy prices and expectations in the current year. Energy prices, which were high worldwide, especially in Europe, due to cyclical developments in the past period, moved downwards in the period on which the valuation report used in the financial statements of December 31, 2024, was based, and this situation negatively affected the power plant value.

This valuation is the company valuation performed at the end of each year by the international independent audit and consulting firm PricewaterhouseCoopers (PwC). This valuation difference does not cause any cash outflow and does not have a negative impact on the company's activities. In the coming periods, if there is an increase in value, it will be included in our financial statements as an item that increases our equity.

For the information of the public.

This statement has been translated into English for informational purposes. In case of a discrepancy between the Turkish and the English versions of this disclosure statement, the Turkish version shall prevail.