Sabancı Industry Group reinforced its leadership in all markets it operates with its agility and excellence-oriented approach.
Kordsa reinforced its leading position in tire reinforcement materials sector during the pandemic, thanks to its proximity to global and regional customers. Kordsa focused on developing products and services for sectors beyond aerospace and aviation in the field of advanced technology composites that it incorporated.
Priorities in 2020
In 2020, the top priority of Industry Group companies was agility against fluctuations in demand due to the pandemic. The Companies continued investing for the future. The fluctuations in demand in the world and in Turkey were foreseen with the data analysis models developed in the prior years. Significant profit was also made with a specific focus on supply chains and working capital management.
While achieving successful results in 2020, the agile teams formed within the Industry Group ecosystem, analyzed growth opportunities in innovative adjacent business areas and investments continued.
2020 has been a devastating year for our lives due to the pandemic, however it also brought growth opportunities to Sabancı Holding Industry Group, which had already started its digital transformation and implements innovative processes and material innovations as part of its daily work.
As the number of digital online meetings rose 60 times, significant improvements have been made in terms of time and cost of internal and external communication. Productivity and reliability of business processes were improved with the Robotic Process Automation (RPA) and therefore employees are able to use their time more effectively for innovation and improvement of existing processes. RPA applications and artificial intelligence assistants of Brisa and Kordsa manage more than 200 processes efficiently.
The digital filiation applications put into practice helped more than 8,500 employees and their families protect their health.
In 2020, Industry 4.0 efforts in companies accelerated. Systems that communicate each other during the production processes, monitor and analyze environment and machine conditions with sensors and trigger actions created predictability and cost advantages.
In the field of digitalization and innovation, the successes of the Industry Group were recognized with many awards.
Producing 1 out of every 3 passenger car tires produced in the world, Kordsa demonstrated outstanding performance by maintaining its combined EBITDA levels in its global tire reinforcement and composites (to civil aviation) businesses, which experienced contractions of 17% and 44% respectively. Unlike its competitors concentrated in the Asian market, Kordsa is geographically close to its customers and has strong “customer intimacy.” Kordsa attracted a strong customer demand and increased its market share in the last quarter following the contraction.
Axiom Materials, one of the USA-based companies of Kordsa received a new license which will make it possible to supply products for power generation applications in the Oxide-Oxide ceramic composite intermediate materials market.
In the field of composites, the expansion and differentiation efforts were accelerated in the consumer sectors beyond aerospace. With the investments in Turkey, Kordsa started to produce and offer new composite products with very high energy absorption capacity in Europe and Turkey.
The building reinforcement technologies initiative of Kordsa grew 1.8 times in 2020. Kratos branded synthetic fiber reinforcement products provide a total cost advantage to the customer. These products are preferred in infrastructure and superstructure projects due to their energy efficiency, long-term durability and low carbon emission characteristics.
Performance in 2020
Creating an operational cash flow of TL 819 million, Kordsa reduced its net debt from USD 387 million in 2019 to USD 331 million with the acquisition of composite companies. Brisa, on the other hand, created an operational cash flow of TL 1 billion, reducing its net debt from TL 1.2 billion in the previous year to TL 661 million.
Digitalization, Technology and Investments
Industrial companies, which are in a cultural transformation to be ready for the new digital age, have proven that companies that can quickly adapt maintain their operational success in the pandemic period. In the Industry Group, 62 projects associated with digitalization are ongoing, and the outputs of 55 projects that have been actively used since 2015 have yielded twice the return on their investments.
By integrating Microsoft Teams before the pandemic, which is one of its #dijitalisyeri (digital workplace) applications, Brisa was named among Microsoft’s global success stories with its efforts. Brisa transformed its success stories into academic case studies within the scope of the BRİKİM project.
The case studies titled “Digital Transformation with Artificial Intelligence,” “Empowering Sales Organization with Digital Technologies,” “Gaining Competitive Edge with Working Capital” were presented to academicians and students at Markalarfisildiyor.com, a digital case study library.
Combining its R&D competency with Continental, Kordsa managed to change the formula used to bond textile reinforcement materials with rubberbased compounds for about a century.
With innovation in mind, Kordsa continues to work on Cokoon, which is a greener adhesion technology that does not contain Resorcinol and Formaldehyde. More than 70 companies in the industry are interested in this “open source” technology. 24 of these companies signed NDAs to receive information on the study and benefit from the know-how. Two companies besides Kordsa and Continental are in the patent pool.
Kordsa reinforced its leadership position in the tire reinforcement market by using its “being close” to the customer both geographically and also with customer intimacy.
As part of digital transformation, 17 Kordsa employees including Data Scientists, Data Engineers and Data Translators who participated in Sabancı University’s Advanced Data Analytics Program have carried out advanced data analytics projects since 2019. In 2020, Kordsa conducted data analytics studies on energy optimization and waste management in cooperation with SabancıDx and other international consulting companies. As a result of these studies, Kordsa created significant value from data.
People and Sustainability
For more than 5 years, Brisa and Kordsa have been listed in the BIST Sustainability Index, which includes companies with the highest corporate sustainability performances. Growing with technology investments and creating economic value for their stakeholders, Sabancı Industry Group companies are building a sustainable future by using natural resources responsibly. Reporting to CDP Climate Change and Water Programs since 2016, Kordsa and Brisa were rated A- in climate change and A- and B in the field of water programs respectively. These ratings demonstrate their global leadership in these areas. Being awarded the highest rating “A” by CDP in the “Supplier Communication Rating” category, Brisa was the only Turkish company to be among global leaders in this field.
Brisa and Kordsa were among the companies that partnered with Ecovadis to ensure the sustainability of the global supply chain. As a result of the evaluation of more than 40 thousand companies in terms of sustainability studies, Kordsa was rated “Gold Company” and Brisa was rated “Silver Company” by Ecovadis. Industry Group companies continue to create value for all their stakeholders and develop environmentally-friendly projects. With success in the systematic assessment where environment, employee rights, ethical and sustainable supply practices are taken as a basis, the Industry Group companies prove that they have sustainability in mind in every step they take.
In 2020, Kordsa was included in the ”most amazing place to work” list in Brazil thanks to high employee satisfaction rates. The list was compiled by São Paulo University Foundation Institute of Administration (FIA) and Universe OnLine (UOL), the largest content, technology, digital payments, media and services company in Brazil as a result of research conducted with 150 thousand employees working in top 100 companies of Brazil.
2021 Priorities and Strategy
Industry Group will have a stronger mobility positioning in 2021 while achieving geographical and industrial expansion.
With its geographical proximity and agility advantages, Kordsa aims to increase its market share in nylon and polyester reinforcement materials. Aiming to transform into an advanced materials company, Kordsa will increase its sales in composite technologies to industries other than the aerospace industry.
Area of activity
Tire and construction reinforcement, composite technologies
1 out of 3 automobile tires and 2 out of 3 aircraft tires are reinforced by Kordsa.
Countries of production
Turkey, Brazil, Indonesia, Thailand and the USA
Number of facilities
Number of produced covered area
580 thousand m2
Number of exported countries
Number of employees
Tire reinforcement products (for passenger, agricultural and industrial vehicles, buses, trucks, aircraft and motorcycles), construction reinforcement products (Kratos macro and micro), composites
TL 69 million R&D investments, 183 patents
Sabancı Holding share
According to data as of 31.12.2020.