Graphite India : Earnings Presentation Q1 2022-2023

Executive Summary_______________________________________

Chairman's Message______________________________________

Steel Industry Overview___________________________________

Graphite Electrode Industry Overview________________________

Financial Performance_____________________________________

Financial Performance Trends_______________________________

Leverage Profile__________________________________________

Segment Performance_____________________________________

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Q1 FY2023

Profit and Loss

(Consolidated)

Balance Sheet

(Consolidated)

• Net Sales of Rs. 866 Crores, an increase of 42% y-o-y and 3% q-o-q
• EBITDA excluding one time charge is Rs. 134 Crores as compared to Rs. 219 Crores in Q1 FY22
• Net Profit of Rs. 24 Crores as compared to Rs. 150 Crores in Q1 FY22
• EPS of Rs. 1.23 per share

• Gross Debt of Rs. 464 Crores
• Cash (Net of Gross Debt) of Rs. 2,203 Crores

Q1 FY2023

Profit and Loss

(Standalone)

Balance Sheet

(Standalone)

• Net Sales of Rs. 798 Crores, an increase of 47% y-o-y and 4% q-o-q
• EBITDA excluding one time charge is Rs. 172 Crores as compared to Rs. 212 Crores in Q1 FY22
• Net Profit of Rs. 63 Crores as compared to Rs. 157 Crores in Q1 FY21
• EPS of Rs. 3.26 per share

• Gross Debt of Rs. 356 Crores
• Cash (Net of Gross Debt) of Rs. 2,118 Crores

K K Bangur

Chairman

"In Q1 FY2023, Graphite India registered a Consolidated Net sales of Rs. 866 Cr, growth of 42% y-o-y and modest growth of 3% on a sequential basis. EBITDA before one time charge was Rs. 134 Cr and Net Profit was Rs. 24 Cr. The capacity utilization during the quarter was 71% as compared to 77% in Q1 FY2022. The year on year sales growth was primarily driven by improvement in realizations while volumes remained subdued. German business operations continued to remain impacted primarily due to higher energy costs which got accentuated with ongoing Russia-Ukraine crisis. From a balance sheet perspective, we maintain a strong consolidated Net Cash position of Rs. 2,203 Cr at the end of June 2022.

The quarter was marked with several macroeconomic challenges such as central banks raising interest rates, supply chain constraints and continuous rise in energy and commodity prices. In addition, the levy of 15% duty on steel exports in middle of the quarter has impacted the steel production in India especially in the month of June-22. Despite these multiple headwinds, Graphite India has delivered a resilient topline performance however margins were impacted due to the increase in overall operational costs.

Amidst the ongoing volatile macroeconomic market conditions globally, the steel demand and production in major EAF producing nations is expected to remain muted. However, the Indian steel industry is expected to deliver growth in 2022 driven by greater push by government on infrastructure development despite the initial setbacks due to levy of export duty. With this backdrop, the demand for electrode and realizations are expected to remain volatile in the near term and cost inflation may continue to add pressure on margins.

At Graphite India, we are committed to reduce our carbon footprint therefore identified GHG emission, waste management and water pollution reduction as our immediate focus areas and intend to reduce its intensity in the coming years. We are conscious of our responsibility towards environment and will continue to adopt best-in-class