Ladies and gentlemen, thank you for standing by. I am Mina, your Chorus Call operator. Welcome, and thank you for joining the Hepsiburada Conference Call and Live Webcast to present and discuss the Third Quarter 2023 Financial Results. All participants will be in a listen-only mode, and the conference is being recorded. The presentation will be followed by a question-and-answer session. [Operator Instructions] At this time, I would like to turn the conference over to Mrs. Nilhan Onal Gökçetekin, CEO; Mr. Seçkin Köseoglu, Vice President of Strategic Finance; and Mrs. Helin Celikbilek, Investor Relations Director. Mrs. Celikbilek, you may now proceed.

Thanks, operator. Thank you for joining us today for Hepsiburada's third quarter 2023 earnings call. I'm pleased to be joined on the call today by our CEO, Nilhan Onal Gökçetekin, and our Vice President of Strategic Finance, Seçkin Köseoglu. The following discussion, including responses to your questions, reflects management's views as of today's date only. We undertake no obligation to update or revise this information except as required by law. Certain statements made on today's call are forward-looking statements and actual results may differ materially from these forward-looking statements. Please refer to today's earnings release as well as the risk factors described in the Safe Harbor slide of today's supplemental slide deck, today's press release, the 6-K, our Form 20-F filed with the SEC on May 1, 2023, and other SEC filings for information on factors that could cause our results to differ materially from these forward-looking statements. Also, we will reference certain non-IFRS measures during today's call. Please refer to the appendix of our supplemental slide deck as well as today's press release for a presentation of the most directly comparable IFRS measures and the relevant IFRS to non-IFRS reconciliation. As a reminder, a replay of this call will be available on our Investor Relations website. And with that, I will hand it over to our CEO, Nihan. Nilhan Onal Gökçetekin: Thank you, Helin. Welcome everyone, and thank you for joining us. I'm pleased to be with you today and to present our quarterly progress. In Q3, amidst continued challenging macroeconomic environment where yearly inflation scaled to 61.5%, we delivered a robust financial performance. Our GMV more than doubled by 126% growth year-on-year. Adjusted for inflation, our GMV growth remained solid at 45% year-on-year. The operational agility, afforded by our strategy, led to an outstanding performance that exceeded expectations.…

Ladies and gentlemen, at this time, we will begin the question-and-answer session. [Operator Instructions] The first question -- I am so sorry, there was a question but it was withdrawn. [Operator Instructions] Ladies and gentlemen, there are no audio questions at this time. We will now proceed with the webcast questions from our participants. The first webcast question is from Maxim Nekrasov with Citi, and I quote, "What drives growth deceleration in Q4 2023 compared to third quarter 2023?" Thank you. Nilhan Onal Gökçetekin: This is Nilhan speaking. We have couple of factors. One of them is our base in Q4 '22 was extremely strong. That's number one driver. Number two driver is, in Q3, Maxim, we had a VAT change, as I explained in July. This accelerated our growth as e-com platforms, which won't be repeated from our expectations in Q4. And lastly, with the rising interest rates, we are expecting also some minor impact to the demand in Turkish markets. Hence, with these three, our expectation is the GMV growth [indiscernible].

[Operator Instructions] The next webcast question is from Ulle Adamson with T. Rowe Price, and I quote, "Any thoughts on possible local listings to improve the liquidity of shares?" Nilhan Onal Gökçetekin: A local possible listing in Istanbul Stock Exchange is one of the ideas that we are always evaluating like other options. There are pros and cons we are investigating, Ulle. As we crystallize our thinking, if there is something to share, we will obviously come back. But this is one of the things we are obviously looking into based on the feedback we received today.

[Operator Instructions] The next webcast question is from Tim Raschuk with Frontaura Capital, and I quote, "Hi. Could you please -- excuse me, could you provide me color on September sales and how the Legendary November event was relative to your expectations? Thank you." Nilhan Onal Gökçetekin: It was almost spot on versus our expectations in November. We have done a couple of assumptions for November growth. One of them was increased uptake from our Premium consumers. Both our Premium membership increase and the frequency increase from Premium consumers has been in-line with our expectations. Non-electronic, new categories that we have been driving have been strong, that has also been in-line with our expectations. And in terms of our marketing plan, the number of sessions we planned for Legendary November also was in-line with our expectations. So, I would say we invented Legendary November seven years ago and since then we have been getting stronger and stronger in our execution. And in-line with our plans, we delivered a strong November campaign.

Our next webcast question is from Christian Andrews with Frontaura Capital, and I quote, "Digital orders represented a significant portion of order growth. Could you expand on what these orders relate to and would their contribution to revenue growth be similar? Nilhan Onal Gökçetekin: The digital orders, yes, they represent significant portion of order growth, but in terms of GMV, it's immaterial. It's less than 0.7% of our GMV. So, we can't talk about any related contribution to our GMV growth. It's strategic. It drives frequency. It drives consumers to come back, create loyalty retention. So, we'll continue driving that.

Thank you. We also have a question from [Mr. Hassan Bayahan] (ph), and I quote, "How do you invest in the U.S. cash you have? What is the return on that?" Seçkin Köseoglu: Hi. We typically use time deposits in banks. And I think the yield is the question, we are close to 5% on our yield for USD deposits.

Thank you. The next question is from Mr. Maxim Nekrasov with Citi, and I quote, "What are your expectations regarding consumer demand in 2024 considering recent interest hikes?" Nilhan Onal Gökçetekin: Our progress and results clearly prove that our strategy works in '23. And as we look forward to the coming year, although the interest rate increases could diminish consumer demand, consumption can also impact Turkish economic growth, we have several key initiatives reinforcing our position. I maintain our commitment to strategic priorities, affordable shopping options, benefits from Premium program, and also e-com is in best place, [very suited] (ph) to serving consumers in this type of environment.

Our next webcast question is a follow-up from Mr. Ulle Adamson with T. Rowe Price, and I quote, "What is the outlook for EBITDA margin in 2024? Also, where would you like to see the margin over the longer term?" Nilhan Onal Gökçetekin: For 2024, we are going to talk about our guidance, our expectations as part of our Q4 earnings result. But what I can say, we are extremely committed to sustainable, profitable growth. We have built a very strong initiative pipeline for '24 and also upcoming years in-line with the presentation we have done, that is including Hepsi advertising platform, that's including non-electronics in our mix, that is including incremental margin from our services and B2B revenues that will continue to enhance our margin situation. For granular details and expectations, we'll come back in Q4.

Thank you. Our next webcast question is from Christian Andrews with Frontaura Capital, and I quote, " Hepsi Premium reached 2 million members. Could you please speak a bit about any targets for the program? Is there a target number of members? Is this program breakeven yet on a consolidated basis?" Nilhan Onal Gökçetekin: In terms of Hepsiburada Premium program, obviously, we are quite bullish about creating a great, amazing program that will be sticky for our consumers. We are not chasing a specific number. We are looking into sustainable profitability of the company, sustainable profitable growth using loyalty retention initiatives in a mix that also includes Premium. Hence, I'm not going to share a specific number that we are chasing for next year, but we will continue to enhance both the benefits of the program and also numbers in the program. In terms of premium Profitability, we don't share the details for a specific consumer segment. In future, we could look into giving different cuts in our profitability, but so far, we are only sharing a consolidated view.

Our next question is an audio question from the land of Kilickiran Hanzade with JPMorgan. Please go ahead.

Nilhan and Seçkin, apologies, I had a technical issue. I couldn't ask my question initially. I would like to follow up on the gross contribution margin. You have a very strong, I mean, robust improvement here. Would it be reasonable to say that some -- I mean, large part of this expansion in the gross margin contribution comes from the inventory gains? Because there was a very high inflation in the third quarter and I just tried to understand whether this expansion is one-off or not. And -- or otherwise, have you observed some structural changes in your business like a higher share of clothing category or better take rates that may continue to support the margins going forward? And the second question is, is it possible to provide some sort of update on the recent competition authority investigation? What it is about? And do you expect some negative results from this investigation? Thank you. Seçkin Köseoglu: Yes, as I mentioned in my presentation, the re-discount impact on cost of inventory sold due to purchases on credit has an impact on the improvement in gross contribution. But the key structural improvement that we are making are related with the 3P GMV category mix towards higher margin product. And this is going to continue in the future as well. And definitely other revenue stream is something that we are continuing to expand, especially a word of note, our Premium fees, our HepsiAd, which is very important for our future profitability, and the expansion of our delivery services. So, these are structural key interventions that we will be continuing to have in the coming quarters as well. Nilhan Onal Gökçetekin: Let me come back on the second question, which is the competitive authority investigation. There has been an investigation in Turkey for price recommendations for merchants from e-commerce platforms. We have been one of the companies that competition authority wanted to better understand the logic. We have been sharing all the data we have. This is a recent capability we developed in order to enhance merchants' competitiveness, in order to enhance competitive prices with right ambition, with right material. So, we are very comfortable in terms of the potential outcome. There could be a situation, Hanzade, in the worst case scenario, the competition authorities could say, "We would like platforms to hold this application," but nothing beyond that. So, even the worst case scenario, obviously we are ready for this, but we wouldn't recommend it.

Thank you very much.

Ladies and gentlemen, there are no further questions at this time. The conference is now concluded, and you may disconnect your telephone. Thank you for calling, and have a good afternoon.