Salzer Electronics Ltd. — Interim / Quarterly Report 2021

Feb 4, 2021

Media Release

Strong quarterly growth, reflecting Company's resilience despite a sluggish domestic market

Q3 FY21 standalone Net Revenue at Rs. 170.44 crore, growth of 26.5% YoY, mainly on account of increase in sales of wire harness product & higher sales in wires & cables business division

Q3 FY21 Standalone EBITDA at Rs. 17.28 crore — YoY growth of 3.4%, driven by revenue growth and operational efficiencies

Standalone Q3 FY21 EBITDA Margin at 10.14%

Standalone Q3 FY21 PAT at Rs. 6.41 crore, YoY growth of 16.38%

SALZER ELECTRONICS LTD.
Media Release
Strong quarterly growth, reflecting Company's resilience despite a sluggish domestic market
Q3 FY21 standalone Net Revenue at Rs. 170.44 crore, growth of 26.5% YoY, mainly on account of increase in sales of wire harness product & higher sales in wires & cables business division
			Q3 FY21 Standalone EBITDA at Rs. 17.28 crore — YoY growth of 3.4%, driven by revenue growth and operational efficiencies
			Standalone Q3 FY21 EBITDA Margin at 10.14%
			Standalone Q3 FY21 PAT at Rs. 6.41 crore, YoY growth of 16.38%
2021: Salzer Electronics Limited (BSE: 517059, NSE: SALZERELEC), among Coimbatore, February 4" leading players offering total and customised electrical solutions, announced its unaudited financial results for the third quarter and nine months ended 31** December 2020.
Key Financial Highlights Rs. In Crore:
,			Standalone				Consolidated
I e-Tad (Ul el	Q3 FY21	Q3 FY20	YoY	9M FY21	9M FY20	YoY	9M FY21*
Net Revenue	170.44	134.71	26.52%	415.93	434.65	(4.31%)	430.34
EBITDA (excluding	47 58	16.71	3.43%	45.63	50.89	(10.34%)	46.32
other income)
EBITDA Margin PAT	10.14% 6.41	5.51	12.40% (226bps) 16.38%	10.97% 13.69	11.71% 17.25	(74 bps) (20.65%)	10.76% 14.03
PAT Margin	3.76%	4.09%	(33 bps)	3.29%	3.97%	(68 bps)	3.26%
Basic EPS (Rs.)	4.01	3.44	16.57%	8.56	10.79	(20.67%)	8.78
*Consolidated — on account of acquisition of 74.9% shares of Kaycee Industries Standalone Financial Performance Highlights
For the third quarter ended December 31%, 2020:
="			well as higher sales of our wire harnesses products in our industrial switch gear division.				Net Revenue in Q3 FY21, Rs. 170.44 crore as against Rs. 134.71 crore in Q3 FY20, YoY growth of 26.5%, mainly on account of increase in sales of our wires and cables business division as
Y			Exports grew at 11.5% Y-o-Y in Q3 FY21.				Contribution from Exports at 18.08%, driven by higher exports to the US and Europe.
="	Breakup of revenue:
v¥			Industrial Switchgear — 38.83% of net revenues
v			Wires & Cables — 55.86% of net revenues

Key Financial Highlights Rs. In Crore:

Standalone Financial Performance Highlights

• =" Net Revenue in Q3 FY21, Rs. 170.44 crore as against Rs. 134.71 crore in Q3 FY20, YoY growth of 26.5%, mainly on account of increase in sales of our wires and cables business division as well as higher sales of our wire harnesses products in our industrial switch gear division.
• Y Contribution from Exports at 18.08%, driven by higher exports to the US and Europe. Exports grew at 11.5% Y-o-Y in Q3 FY21.
• =" Breakup of revenue:
• v¥ Industrial Switchgear 38.83% of net revenues
• v Wires & Cables 55.86% of net revenues

• v¥ Buildings Products 5.32% of net revenues
• =" EBITDA (excluding other income) stood at Rs. 17.28 crore in Q3 FY21 as against Rs. 16.71 crore in Q3 FY20, YoY increase of 3.43%, on account of reduction in employee cost and other expenses
• = EBITDA Margin for the quarter stood at 10.14%, declined by 226 bps on account of higher contribution form the wires & cables division.
• = Profit After Tax at Rs. 6.41 crore in Q3 FY21 as against Rs. 5.51 crore in Q3 FY20, YoY growth of 16.38%

For the nine months ended December 31*, 2020:

• = Net Revenue in 9M FY21, Rs. 415.93 as against Rs. 434.65 crore in 9M FY20, YoY decline of 4.31% on account of nationwide lockdown during the first quarter of the financial year
• Y Contribution from exports was 20% in 9M FY21, as against 16.87% in 9M FY20, mainly on account of higher exports to European and US markets. Exports grew at 14% Y-o0-Y for 9M FY21.
• =" Breakup of revenue for the Electrical Installation Products:
• v Industrial Switchgear 41.33% of total revenues
• ¥ Wires & Cables 53% of total revenues
• ¥ Buildings Products 4.98% of total revenues
• ^vEnergy Management 0.70% of total revenue
• * EBITDA (excluding other income) stood at Rs. 45.63 crore in 9M FY21 as against Rs. 50.89 crore in 9M FY20, YoY decline of 10.34%, mainly on account of lower sales due to lockdown in Qi.
• = 9M FY21 EBITDA Margin at 10.97%, YoY decline of 74 bps, mainly due to the mix of sales, where Wire & Cable contribution is at 53% as against 47% last year, which has led to lower EBIDTA Margins
• = Profit After Tax was at Rs. 13.69 crore in 9M FY21 as against Rs. 17.25 crore in 9M FY20

Management Comment:

Commenting on this, Mr. Rajesh Doraiswamy, Joint Managing Director, Salzer Electronics Ltd said:

"Lam happy to share that our third quarter performance has been in line with expectations and marks our continued & sustained recovery from the Pandemic-induced slowdown. In the third quarter of this financial year, we registered a 26.5% Y-o-Y growth in revenue at Rs. 170.4 crores, while EBITDA and PAT were Rs. 17.3 crore and Rs. 6.4 crore respectively, having grown 3.4% and 16.4% year-on-year, respectively. The performance in the nine-month period has been impacted due to lockdown on account of Covid-19 in the first quarter and low demand across the domestic market. However, the

third quarter performance was good with growth coming in from wire harness product and export markets of US and Europe. The only Challenge remains is the input material price increase. The lag between the passing off of input costs to customers will have bearing on the margins.

With the markets gradually opening up and business regaining momentum, we expect to maintain our growth trajectory with our robust product offerings and strong brand position in the market. Overall, we remain committed to our set agenda of delivering sustainable growth and expect to match our last year's business performance, though our internal target is to demonstrate growth this year and hope to achieve the same. | thank all our stakeholders for their continued support and faith in our Company."

About Salzer Electronics

• =" Salzer is a Leading player offering Total and Customized Electrical Solutions in Switchgears, Wires & Cables and Energy Management business. It is the largest manufacturer of CAM Operated Rotary switches & Wire Ducts in India. The Company caters to a wide range of products with four in-house manufacturing facilities, located in Coimbatore.
• =" The Company has a wide distribution network locally and globally, exporting to many countries. In India, Salzer markets its products through its own distributors and more than 350 local distributors of L&T. The Company has a strong R&D team that focuses on developing and commercializing the technologies of the products, and as a result, can offer total customized electrical solutions to its customers.

For further information, please contact:

Mr. Baskarasubramaniam	Ms. Savli Mangle / Mr. Rahul Trivedi
Salzer Electronics Ltd.	Bridge Investor Relations Pvt. Ltd.
baskarasubramanian@salzergroup.com Email:	Email: savli@bridge-ir.com_/ rahul@bridge-ir.com
www.salzergroup.net	www.bridge-ir.com

Caution Concerning Forward- Looking Statements:

This document includes certain forward-looking statements. These statements are based on management's current expectations or beliefs and are subject to uncertainty and changes in circumstances. Actual results may vary materially from those expressed or implied by the statements herein due to changes in economic, business, competitive, technological and/or regulatory factors. The Company is under no obligation to, and expressly disclaims any such obligation to, update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise.