EPL conducted conference call on 20 May 2023 to discuss the financial results and performance of the company for the quarter ended March 2023. Mr. Anand Kripalu – MD & Global CEO, Mr. M.R. Ramasamy – COO and Mr. Amit Jain – CFO long with other senior management of the company addressed the call

Highlights of the Concall

• EPL has now completed 40 years since its inception in December 1982. It has come a long way from a single plant in Vasind to 21 plants today across five continents.

• The external environment continues to be challenging and volatile. However, the silver lining is that things have started to settle and become more predictable with each passing quarter.

• The company achieved double digit revenue growth of 10.1%, which was broad based across all regions. Amesa (Africa, Middle East & South Asia including India) grew by 7.6% and was significantly impacted by the devaluation of the Egyptian pound. At constant currency, Amesa grew at 15.5%, America grew by 17.1% and Europe by 19.9%. With the lifting of COVID restrictions EAP (East Asia Pacific) bounced back to deliver growth of 8.6%.

• EPL delivered strong EBITDA margin at 17.2%, which is an improvement of 186 basis points versus Q4 last year. Despite market challenges during the year, EPL reported consistent margin improvement quarter on quarter and astrong exit to the year

• Net Profit grew by 80.7% partly enabled by tax credit pertaining to earlier years.

• Polymer and foil prices remained stable in Q4FY23 while Ocean freight rates declined to pre-Covid level

• Strong cash flow generation leading to YoY and sequential reduction in net debt resulting into lower Net Debt/EBITDA at 0.6 times.

• Personal care and beyond grew at 11.6% in FY23 faster than oral at 9.5%. Personal Care and beyond now contributes to 47% of its total business.

• Production commenced in the Brazil Greenfield project and will be ramped up in the first quarter of FY24. The company has gone into Brazil on the back of an anchor customer and its first priority is to ramp up and deliver the commitments that it had made to the anchor customers. But in parallel with that it is also exploring possibilities for customer base expansion.

• In FY 23, EPL increased volumes of sustainable cubes by nearly 2.5 times which now accounts for almost 10% of the total. The company aims to double this again next year

• The company mentioned that while many of the known challenges of FY 23 have eased, everything isn't completely normal. Inflation and recessionary fears, especially in the western economies make demand less predictable. Interest rates remain high, and forex remains unstable. Increase in minimum wage across the globe has resulted in cost increases.

• EPL priorities for FY 24 include to continue to deliver double digit revenue growth, drive recovery in East Asia Pacific based on expected revival of the China economy post covid, ramp up volumes in Brazil and expand the customer base and fourth to continue focus on selective price increases wherever it is suffering cost increases, margin improvement through mixing cost management, manufacturing location optimization and efficient capital allocation.