Emami Ltd — Annual Report 2020

Jun 26, 2020

Q4 & FY20 Performance Update

26th June 2020

FY20 Performance Snapshot (Consolidated)

Key Financials	FY20 Growth	Q4FY20 Growth	9MFY20 Growth*
Consolidated Revenue Growth	-1%	-17%	3%
Domestic Business Growth (incl. Institutional)	-4%	-19%	0%
International Business growth	16%	-4%	24%
EBIDTA Growth	-5%	-37%	4%
PAT Growth	0%	-58%	13%
Cash Profit Growth	2%	-21%	8%

*Limited Review

• Weak rural demand and liquidity concerns persisted prior to lockdown and supply chain disrupted from mid-March due to COVID-19
• Operations came to a complete halt during the last week of March due to nation wide lockdown affecting the pre-season sale of the summer portfolio impacting Q4 & FY20 performance

Business Performance

Key Market Shares

Key Brands	Market Share Volume*	Growth over PY
Navratna Oils	66.4%	+ 10 bps
Zandu + Mentho Plus Balms	54.9%	+ 130bps
BoroPlus Antiseptic Cream	74.1%	+ 30bps
Fair and Handsome Cream	65.3%	- 30 bps
Kesh King Oil	26.6%	+ 140 bps

Domestic Brandwise performance

Key Brands	FY20 Growth	Q4FY20 Growth	9MFY20 Growth
Navratna Range	-2%	-12%	4%
Pain Management Range	3%	-5%	5%
BoroPlus Range	-7%	-77%	0%
Kesh King Range	1%	-26%	12%
Healthcare Range	-2%	-9%	1%
Male Grooming Range	-29%	-42%	-25%
7 Oils in One	29%	5%	39%

Foray into Hygiene space

BoroPlus Advanced Anti-Germ Hand Sanitizer

Launched in April'20

BoroPlus Antiseptic+ Moisturizing Soap

Launched in June'20

BoroPlus Antiseptic+ Moisturizing Handwash

To be launched in June'20

New Launches in Healthcare Range

Zandu Ayurvedic Hand Sanitizer

Zandu Ayush Kwath Powder

Launched in June'20

An Ayurvedic immunity booster Kadha launched in June'20

Zandu Single Herb Range

• Amalaki: Guaranteed immunity builder
• Asvagandha: Immunity Booster / Adaptogenic stress buster
• Giloy: Immunity booster / promotes liver function
• Neem: Immunity booster / protects from skin infections
• Tulasi: Immunity booster for family
• Turmeric: Immunity Booster / Protects from infections

New Launches/ Relaunches in Q4FY20

Navratna Smart Cool Talc relaunched as "Maxx Cool" for Longest Lasting Cooling

Relaunched Navratna Cool Talc with modernized packaging and superior claims

Launched BoroPlus Organic Aloevera Gel - The only gel with 100% organic Aloe Leaf Extract, Antiseptic Herbs & Vitamin E for Healthy, Hydrated and Nourished Skin and Hair

New Media campaigns

8

Roped in Bollywood superstar Salman Khan as Raahat Raja, the popular icon of Navratna.

The commercial has been directed by Nitesh Tiwari (Dangal and Chhichhore fame)

Expected to extend the product messaging to the masses

Digital Campaign for Zandu Immunity Building range

Aired Medifacts Campaign to build superiority of Zandu Balms against painkiller tablets

International Business

• Sales grew by 16% in FY20. However, sales declined by 4% in Q4
• SAARC, MENAP and CIS grew in double digits in FY20
• Market shares across key markets continued to grow consistently –
• Bangladesh (Navratna, Fair and Handsome and 7 Oils in One)
• UAE (Navratna and Fair and Handsome)
• Russia (BoroPlus)

• SAARC South Asian Association for Regional Cooperation (Major countries – Bangladesh, Nepal, Sri Lanka etc.)
• SEA South East Asia (Major countries – Malaysia, Myanmar & Singapore)
• MENAP Middle East, North Africa & Pakistan (Major countries – UAE, Qatar, Oman, Kuwait, Bahrain etc.)
• CIS Commonwealth of Independent States (Major Countries – Russia, Ukraine etc.)

Financial Analysis

Earnings analysis for Q4 & FY20

Q4FY20 Financial analysis

FY20 Financial analysis

12

Q4FY20 Summarized Financials

₹ in Millions

Particulars	Q4FY20	%	Q4FY19	%	Growth %
Net Sales	5,228.3	98.2%	6,350.3	99.2%	-17.7%
Other Operating Income	98.5	1.8%	53.2	0.8%	85.2%
Revenue from Operations	5,326.8	100.0%	6,403.5	100.0%	-16.8%
Materials Cost	1,856.0	34.8%	2,507.7	39.2%	-26.0%
A&P	989.1	18.6%	989.8	15.5%	-0.1%
Staff Cost	720.6	13.5%	680.9	10.6%	5.8%
Admn & Other Exp	775.8	14.6%	670.9	10.5%	15.6%
EBIDTA	985.3	18.5%	1,554.2	24.3%	-36.6%
Other Income	144.9	2.7%	165.6	2.6%	-12.5%
Interest	24.1	0.5%	62.1	1.0%	-61.2%
Amortisation of acquired TM's/ brands	633.0	11.9%	650.3	10.2%	-2.7%
Depreciation/Amortisation of other assets	219.4	4.1%	159.7	2.5%	37.4%
PBT before Exceptional Items	253.7	4.8%	847.7	13.2%	-70.1%
Exceptional Items	74.2	1.4%	-	0.0%	100.0%
PBT	179.5	3.4%	847.7	13.2%	-78.8%
Tax	(73.7)	-1.4%	279.8	4.4%	-126.3%
PAT	253.2	4.8%	567.9	8.9%	-55.4%
Share of Minority Interest & P/L of Associate	(19.6)	-0.4%	(6.4)	-0.1%	206.2%
PAT After Minority Interest & Associate	233.6	4.4%	561.5	8.8%	-58.4%
Cash Profit (PAT + Dep. & Amortization)	1,086.0	20.4%	1,371.5	21.4%	-20.8%
EPS - Rs.	0.51		1.24
Cash EPS- Rs.	2.39		3.02

FY20 Summarized Financials

₹ in Millions

Particulars	FY20	%	FY19	%	Growth %
Net Sales	26,106.4	98.3%	26,589.2	98.7%	-1.8%
Other Operating Income	442.4	1.7%	357.1	1.3%	23.9%
Revenue from Operations	26,548.8	100.0%	26,946.3	100.0%	-1.5%
Materials Cost	8,761.0	33.0%	9,230.1	34.3%	-5.1%
A&P	4,711.4	17.7%	4,701.8	17.4%	0.2%
Staff Cost	2,995.1	11.3%	2,797.2	10.4%	7.1%
Admn & Other Exp	3,175.9	12.0%	2,945.0	10.9%	7.8%
EBIDTA	6,905.4	26.0%	7,272.2	27.0%	-5.0%
Other Income	570.7	2.1%	349.0	1.3%	63.5%
Interest	210.1	0.8%	214.0	0.8%	-1.8%
Amortisation of acquired TM's/ brands	2,589.0	9.8%	2,485.0	9.2%	4.2%
Depreciation/Amortisation of other assets	774.3	2.9%	768.2	2.9%	0.8%
PBT before Exceptional Items	3,902.7	14.7%	4,154.0	15.4%	-6.0%
Exceptional Items	106.8	0.4%	98.0	0.4%	9.0%
PBT	3,795.9	14.3%	4,056.0	15.1%	-6.4%
Tax	712.7	2.7%	1,008.8	3.7%	-29.4%
PAT	3,083.2	11.6%	3,047.2	11.3%	1.2%
Share of Minority Interest & P/L of Associate	(54.1)	-0.2%	(14.9)	-0.1%	263.1%
PAT After Minority Interest & Associate	3,029.1	11.4%	3,032.3	11.3%	-0.1%
Cash Profit (PAT + Dep. & Amortization)	6,392.4	24.1%	6,285.5	23.3%	1.7%
EPS - Rs.	6.67		6.68
Cash EPS- Rs.	14.08		13.85

Balance Sheet

₹ in Millions

Sl.	ASSETS	As at 31.03.2020	As at 31.03.2019	Sl.	EQUITY AND LIABILITIES	As at 31.03.2020	As at 31.03.2019
1	Non -Current Assets				Equity
(a)	Property, Plant and Equipment	7,685	7,490	(a)	Equity Share capital	453	454
(b)	Capital work-in-progress	69	352	(b)	Other Equity	17,784	20,307
(c)	Investment Property	545	548		Total Equity attributable to owners of the Parent	18,238	20,761
(d)	Goodwill	-	41	(c)	Non-Controlling Interest	(9)	(2)
(e)	Other Intangible Assets	6,191	8,722		Total Equity	18,229	20,759
(f)	Right of Use Assets	172	-
(g)	Intangible assets under development	12	11
(h)	Financial Assets
	(i) Investments				LIABILITIES
	a) Investment in Associates	212	160	1	Non-Current Liabilities
	b) Others	669	1,631	(a)	Financial Liabilities
	(ii) Loans	117	143		(i) Other Financial Liabilities	154	69
	(iii) Other Financial Assets	394	291
(i)	Deferred Tax Assets (net)	0	38
(j)	Non-Current Tax Assets	135	126	(b)	Provisions	231	200
(k)	Other Non-Current Assets	253	178	(c)	Deferred tax liabilities (Net)	35	160
				(d)	Other Non-Current Liabilities	216	237
		16,452	19,730			636	666
2	Current assets
(a)	Inventories	2,447	2,217	2	Current liabilities
(b)	Financial Assets			(a)	Financial Liabilities
	(i) Investments	683	79		(i) Borrowings	2,102	1,099
	(ii) Trade Receivables	3,080	2,164		(ii) Trade Payables
					Total oustanding dues of Micro & Small
	(iii) Cash & Cash Equivalents	108	1,165		enterprise	230	30
					Total oustanding dues of creditors others than
	(iv) Bank Balances other than (iii) above	1,082	869		Micro & Small Enterprises	3,014	2,883
	(v) Loans	663	29		(iii) Other Financial Liabilities	520	1,326
	(vi) Other Financial Assets	785	498	(b)	Other Current Liabilities	486	245
				(c)	Provisions	1,455	1,153
(c)	Other Current Assets	1,484 10,333	1,473 8,493	(d)	Current Tax Liabilities (Net)	112 7,920	63 6,800
	Total Assets	26,785	28,224		Total Equity and Liabilities	26,785	28,224

Awards & Accolades

• Awarded the "Company of the year– FMCG" by CNBC-Awaaz for the company's outstanding performance on parameters such as growth, capital efficiency and profitability over a period of time
• Zandu Balm, BoroPlus and Navartna bagged 35th, 75th and 96th positions among the " Top 100 Most Trusted Brands" under the aegis of The Economic Times - Brand Equity
• HE Magic Duo and Emami 7 Oils in One were conferred with the 'Recognition of Product Packaging" under the Innovation, Creativity and Development Category. Also received the "President's Special Award" for the new and fresh packaging concept of Emami 7 Oils in One out of the Top 3 Shortlisted Packaging among all entries from SIES Educational group.

Thank you