EPL conducted conference call on 10 May 2022 to discuss the financial results and performance of the company for the quarter ended Mar'22. Mr. Anand Kripalu – MD & 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

• FY22 saw unprecedented volatility with inflation in input costs - polymers, aluminum packaging, or freight. Also continued COVID related issues in the western world lead to absenteeism and overtime costs, with COVID having a significant impact in China. Further Russia Ukraine conflict also impacted performance.

• The company delivered revenue growth of 8.6% in Q4FY22. Oral Care grew by 8% and personal care grew by a faster 9.5%. Ebitda margin for the quarter stood at 15.4%, a little lower than the 15.7% of the previous quarter, impacted by the recent unforeseen events.

• The company reported double digit revenue growth of 11% y-o-y in FY22 led by AMESA (Africa, Middle East and South Asia including operations in India and Egypt), EAP (East Asia Pacific including operations in China and Philippines) and AMERICAS (includes operations in United States of America, Mexico and Colombia). During FY22, oral care grew by 10.2% and personal care grew by 11.2%. Personal care was significantly impacted by the decline of the category in Europe due to COVID.

• Ebitda margin during the year was impacted by steep increase in raw material prices & freight cost, lag in price pass-through, and higher employee absenteeism in certain geographies due to Covid. Ebitda margin has declined in Q4FY22 vs Q4FY21 due to continued increase in material prices in Q4, freight cost increase and lag in price pass-through.

• Raw material prices continued to increase in Q4FY22. LLDPE prices were higher by 16% in Q4FY22 compared to Q4FY21 while HDPE prices were up 17% over the same period

• Europe and Americas have seen challenges on margin during the year. However both these regions delivered improved exit margins versus the full year average. Europe recorded a Q4 margin of 11.9% and the Americas 15.7%.

• The biggest challenge for the company regarding margin has been the ability to recover pricing in not just an inflationary but also a highly volatile environment.

• The company purpose and ambition is to be the most sustainable packaging company in the world. Consequently, it is stepping up its efforts to innovate and lead the pack with an expanded set of 100% recyclable offerings. This ensured a ramp-up of container volumes across several of its large and small customers alike, such as Colgate, P&G, Unilever, GSK. The company expects this to further ramp up exponentially in FY '23.

• Q4FY22 was challenging in China. Typically, Q4 is probably the smallest quarter in the year because of Chinese New Year. Also China, like anyone else, has faced huge input cost increases, and that impacted their performance. And towards the end of the quarter, covid started having a material impact to the quarter.

• Outlook on China remains challenging and remains a bit uncertain because China has this kind of no-tolerance policy on covid. Outside of China, the company remains cautiously confident about performance in the rest of the world.

• The company remains positive for India business. It is stepping up pricing and the aggressiveness of getting more pricing done which shall help both topline as well as margins.

• The company plans to enter Brazil on 5 the back of a commitment from a global customer is getting finalized. However the company has not finalized the capex plans.