GRP Limited Investor Presentation November 2019 Click Here for GRP LTD’s Corporate Video
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by GRP Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment what so ever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company. This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded Certain matters discussed in this Presentation may contain statements regarding the Company’s market opportunity and business prospects that are individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties include, but are not limited to, the performance of the Indian economy and of the economies of various international markets, the performance of the industry in India and world-wide, competition, the company’s ability to successfully implement its strategy, the Company’s future levels of growth and expansion, technological implementation, changes and advancements, changes in revenue, income or cash flows, the Company’s market preferences and its exposure to market risks, as well as other risks. The Company’s actual results, levels of activity, performance or achievements could differ materially and adversely from results expressed in or implied by this Presentation. The Company assumes no obligation to update any forward-looking information contained in this Presentation. Any forward-looking statements and projections made by third parties included in this Presentation are not adopted by the Company and the Company is not responsible for such third party statements and projections. 2
Performance Highlights
Performance Highlights for Q2FY20 * (in Rs. Mn) Gross Profit Revenue EBIDTA PAT 899.0 457.0 64.3 22.0 889.5 444.1 46.0 4.8 Q2FY19 Q2FY20 Q2FY19 Q2FY20 Q2FY19 Q2FY20 Q2FY19 Q2FY20 Revenue / Profitability ▪ Revenue has been flat on the back of subdued auto demand leading to lower offtake by the Tyre Companies ▪ Compared to previous year, EBITDA has reduced primarily on account of increase in Raw Material cost due to continuing import restrictions in a SKU *Data on Standalone Basis. Q2FY20 Numbers are as per IND-AS 116 4
Quarterly Trends* (in Rs. Mn) Revenue EBIDTA PAT 976.5 94.2 41.9 918.7 899.0 896.9 889.5 35.0 64.3 49.9 22.0 46.0 37.6 4.8 3.3 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 *Data on Standalone Basis. Q1 & Q2 FY20 Numbers are as per IND-AS 116 5
Operational Highlights Overall markets are challenging due to lower RM prices expected to soften in H2 due to restriction economic activity globally and drop in virgin prices on alternate use of End Of Life Tyres Focused opportunities in the tyre sector Due to the Auto Sector slowdown, the volumes Operational Highlights would positively impact the profitability of the and price realizations has remain muted in business H1FY20 Automation remains a key focus area towards Drop in operating margins is on account of improving margins continued material import restrictions in a SKU 6
Segment Wise Performance Trend* Revenue Revenue Geographical Break-Up Business Segments Break-Up 3.5% 4.2% 5.4% 5.9% 6.5% 24% 27% 28% 29% 38% 96.5% 95.8% 94.6% 94.1% 93.5% 76% 73% 72% 71% 62% Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Domestic Non-Reclaim Rubber Export Reclaim Rubber *Data On Standalone Basis 7
Segmental Financial Highlights* Reclaim Rubber Non-Reclaim Rubber Particulars (in Rs. Mn)* Q2FY20 Q2FY19 % Growth Q2FY20 Q2FY19 % Growth Revenue (Net of Taxes) 848.9 864.8 -1.8% 40.6 34.3 18.3% Raw Material 432.1 428.8 0.8% 13.3 13.3 0.1% Other Expenses 379.0 376.3 0.7% 19.1 16.3 17.0% EBIDTA 37.8 59.7 -36.6% 8.2 4.7 74.5% EBIDTA Margin 4.5% 6.9% 20.2% 13.7% Non-Reclaim Rubber Business ✓ Non-Reclaim business increased by 18% in Q2FY20 vs Q2FY19 in +74.5% +650 bps line with our efforts to increased share of Non-Reclaim Businesses 20.2% 8.2 13.7% 4.7 ✓ EBITDA for Non-Reclaim Business increased by 75% and EBITDA Margins expanded by 650 bps ✓ Q2FY19 Q2FY20 Q2FY19 Q2FY20 The share of Non-Reclaim has not increased Q-o-Q due to slow growth in demand in N-America for Polymer Composite business Increased share of non reclaim rubber business going forward and domestic auto sector for Industrial Polymer business. should add up to the overall profitability of the company *Data on Standalone Basis. Q2FY20 Numbers are as per IND-AS 116 8
Standalone Q2FY20 Profit & Loss Statement Profit & Loss (Rs. Mn) Q2 FY20 Q2 FY19 Y-o-Y / Bps H1FY20 H1 FY19 Y-o-Y / Bps Revenue (Net of Taxes) 889.5 899.0 -1% 1,786.4 1,674.5 7% Cost of Goods Sold 445.4 442.1 901.8 794.2 Gross Profit 444.1 457.0 -3% 884.6 880.3 0% Gross Profit Margin 49.9% 50.8% 49.5% 52.6% Employee Cost 143.0 147.0 291.7 279.7 Other Expenses 255.0 245.6 497.0 482.6 EBIDTA 46.0 64.3 -28% 95.9 118.0 -19% EBITDA Margin 5.2% 7.2% 5.4% 7.0% Other Income 2.6 1.8 4.6 3.5 Depreciation 33.2 32.2 66.0 64.0 Finance Cost 12.4 16.3 23.8 31.5 PBT 3.0 17.6 -83% 10.8 26.0 -58% Tax (1.8) (4.4) (35.9) 0.4 PAT 4.8 22.0 -78% 46.7 25.5 83% PAT Margin 0.5% 2.4% 2.6% 1.5% Cash Profit 38.0 54.1 -30% 112.7 89.5 26% Q2 & H1 FY20 Numbers are as per IND-AS 116 9
Standalone Balance Sheet Liabilities (Rs. Mn) Sep-19 Mar-19 Assets (Rs. Mn) Sep-19 Mar-19 Non-Current Assets 1,347.2 1,331.9 Total Equity 1,361.5 1,337.9 Property, Plant and Equipment 1,088.9 1,179.2 Equity Share Capital 13.3 13.3 Capital work in progress 19.7 9.7 Other Equity 1,348.2 1,324.6 Right to use 102.2 0.0 Investment Property 10.8 11.0 Non-Current Liabilities 205.0 248.0 Intangible assets 1.8 2.1 Financial Liabilities Intangible assets under development 1.2 1.2 (i)Borrowings 18.6 28.9 Financial Assets (i)Investments 83.2 80.9 (ii)Other Financial liabilities 11.3 0.0 (ii)Loans 0.0 0.0 Provisions 4.6 5.4 Other Non-Current Assets 39.3 47.9 Deferred Tax Liabilities (Net) 170.6 213.7 Current Assets 1,236.0 1,167.1 Current Liabilities 1,016.6 913.1 Inventories 377.2 344.0 Financial Liabilities Financial Assets (i)Borrowings 695.9 588.6 (i)Trade receivables 693.2 650.4 (ii)Cash and cash equivalents 9.4 43.6 (ii)Trade Payables 151.3 217.7 (iii)Bank balances other than (iii)Other Financial Liabilities 43.1 35.2 2.1 2.1 mentioned Other Current Liabilities 121.8 68.4 (iv)Other Financial assets 5.4 14.8 Provisions 4.5 0.3 Current Tax Assets (Net) 1.3 0.0 Current tax liabilities (Net) 0.0 2.7 Other Current Assets 147.5 112.2 Total Equity & Liabilities 2,583.1 2,499.0 Total Assets 2,583.1 2,499.0 10
Consolidated Q2FY20 Profit & Loss Statement Profit & Loss (Rs. Mn) Q2 FY20 Q2 FY19 Y-o-Y H1FY20 H1 FY19 Y-o-Y Revenue (Net of Taxes) 888.5 901.9 -1% 1,786.8 1,677.9 6% Cost of Goods Sold 439.0 441.1 892.4 791.3 Gross Profit 449.5 460.7 -2% 894.3 886.5 1% Gross Profit Margin 50.6% 51.1% 50.1% 52.8% Employee Cost 143.9 147.9 293.4 281.4 Other Expenses 257.5 248.1 501.7 487.6 EBIDTA 48.1 64.8 -26% 99.3 117.5 -16% EBITDA Margin 5.4% 7.2% 5.6% 7.0% Other Income 1.4 0.5 2.3 1.7 Depreciation 33.6 33.1 66.8 65.8 Finance Cost 12.6 16.6 24.1 32.1 Profit Before Share of Profit/(Loss) of JV's 3.3 15.7 -79% 10.7 21.3 -50% Share of Profit/(Loss) of JV's 0.0 -1.5 0.0 -2.7 PBT 3.3 14.1 -76% 10.7 18.6 -43% Tax (1.6) (4.4) (35.7) 0.4 PAT 4.9 18.5 -73% 46.3 18.2 154% PAT Margin 0.6% 2.1% 2.6% 1.1% Cash Profit 38.5 51.6 -25% 113.2 84.0 35% Q2 & H1 FY20 Numbers are as per IND-AS 116 11
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