EPL conducted conference call on 29 July 2021 to discuss the financial results and performance of the company for the quarter ended June'21. Mr. Sudhanshu Vats – MD & CEO, Mr. M.R. Ramasamy – COO and Mr. Parag Shah- CFO of the company addressed the call

Highlights of the Concall

• The company delivered 7.8% revenue growth in Q1FY22 to Rs 799.1 crore. On a pro-forma basis for shutdown of Russia manufacturing operations and Hand sanitizer pipeline in Q1FY21 the company had double digit growth of 12.8%.

• Ebitda margin fell from 19.8% in Q1FY21 to 18.1% in Q1FY22 but rose 66 bps compared to previous quarter. EBITDA margin and growth lower vs PY due to steep increase in raw material prices and freight cost increase

• The company is committed to deliver double digit revenue growth YoY and deliver sequential margin expansion QoQ from Q4FY21 onwards.

• The company plans sequential margin expansion through judicious price increases led by contractual pass-through in long term contracts and price corrections being negotiated across geographies to offset the raw material price increase, cost productivity Initiatives led Project Phoenix Phase II and Focus on higher-profit segments and value-added offerings

• The company has taken price increase across the board

• The company faced unprecedented supply chain disruption during the quarter along with its customers

• Raw material prices continue to remain high. LLDPE prices rose 55% in Q1FY22 compared to Q1FY21 and 16% compared to Q4FY21. HDPE prices rose 52% in Q1FY22 compared to Q1FY21 and 8% compared to Q4FY21.

• Freight cost has skyrocketed. For example freight cost from China to US which was earlier around US $4000 the company was unable to find containers even ready to pay around US $15000-18000. Even between even within Asia between Thailand and India, the numbers have gone from US $600 to US $3,000.

• The company Columbia plant was shut down for almost one month in May. The company also faced challenges in India due to second wave of covid. The company also had to shut its one of India plant in 3-4 days

• The company lost around Rs 18 crore of revenues due to second wave of covid and higher freight cost.

• The company June month performance was better than the consolidated quarter numbers

• The company is working towards a number of small and reasonably big projects-more than 350 projects - related to Project Phoenix towards cost saving initiatives.

• The company did a capex of Rs 53.1 crore in Q1FY22

• Personal Care contribution in AMESA (Africa, Middle East and South Asia) increased to 56.6% in Q1FY22 (v/s 46.0% in Q1FY21). Growth is seen majorly due to the recovery of B&C category from ongoing Covid -19 outbreak

• Personal Care contribution in EAP (East Asia Pacific) decreased to 38.3% in Q1FY22 (v/s 44.9% in Q1FY20), due to demand for sanitizer tubes tapering off in Pharma category. However, robust growth in B&C category.

• Personal Care contribution in Americas decreased to 21.5% in Q1FY22 (v/s 29.4% Q1FY21). Growth impacted due to lower offtake in personal care category, month-long strike in Colombia and one

• Personal Care contribution in Europe decreased to 61.2% in Q1FY22 (v/s 70.0% in Q1FY21), due to demand for sanitizer tubes tapering off and closure of Russia manufacturing operation key customer moving production from Colombia to Asia.