Sheela Foam conducted conference call on 16 August 2021 to discuss the financial results and performance of the company for the quarter ended June'21. Mr. Rahul Gautam - Managing Director, Mr. Tushaar Gautam- Director, Mr. Rakesh Chahar – Director, Sales and Marketing and Mr. Davinder Ahuja – CFO Indian Operation, of the company addressed the Concall.

Highlights of the Concall

• Mattresses business was Rs 140 crore in Q1FY22 compared to Rs 67 crore in Q1FY21 and Rs 210 crore in Q4FY21.

• Home comfort products business was Rs 6 crore in Q1FY22 compared to Rs 4 crore in Q1FY21 and Rs 12 crore in Q4FY21..

• Furniture foam business was Rs 39 crore in Q1FY22 compared to Rs 17 crore in Q1FY21 and Rs 72 crore in Q4FY21.

• Foam core business was Rs 66 crore in Q1FY22 compared to Rs 23 crore in Q1FY21 and Rs 127 crore in Q4FY21.

• Technical foam business was Rs 75 crore in Q1FY22 compared to Rs 16 crore in Q4FY21 and Rs 113 crore in Q4FY21.

• Raw material prices continue to double up with wild fluctuations with almost changes to the extent of 15 to 20% and by one particular month it saw a almost 25% change mainly due to availabilty and global shipping. Global shipping is in complete disarray.

• Average TDI price was Rs.214 per kg in Q1FY22 compared to Rs. 124 per kg in Q1FY21 and Rs.184 per kg in Q4FY 21

• Average POLYOL price was Rs.236 per kg in Q1FY22 compared to Rs. 108 per kg in Q1FY21 and Rs.206 per kg in Q4FY21

• The company expects raw materials to fluctuate for few more months before settling down. As a result the company could see wide variations in margins quarter to quarter

• The company generally saw that TDI prices were double of polypol prices which are now more than the TDI prices. Polyol prices had never seen such wide fluctuations.

• Australia performance has been stable as they did not have much of a lockdown. But now they are impacted as the number of corona cases is increasing.

• Revenue from Australia operations was Rs. 103 crore compared to Rs. 82 crore of Q1FY21, registering a growth of 27%. The EBITDA for the quarter was Rs. 12 crore as compared to Rs. 13 crore of corresponding quarter. Net Profit (PAT) was Rs. 3 crore compared to Rs. 4 crore of corresponding quarter.

• Revenue from Spain operations was Rs. 122 crore compared to Rs. 60 crore of Q1FY21, registering a growth of 103%. The EBITDA for the quarter was Rs. 7 crore as compared to Rs. 11 crore of corresponding quarter and the Net Profit (PAT) was Rs. 4 crore compared to Rs. 7 crore of corresponding quarter.

• The IT initiative based in India is progressing well both in the Indian market as well as in the outside market.

• The company is trying to scale up export orders from India and Spain operations.