CHEMICAL AND ALLIED PRODUCTS : EARNINGS RELEASE

Chemical and Allied Products Plc - Q1 2023 Unaudited Results

NGX Ticker: CAP

PRESS RELEASE

Regulated Information

Unaudited Quarterly Financial Results for the Period Ended 31 March 2023

Lagos, 27 April 2023 - Chemical and Allied Products Plc ("CAP" or the "Company"), Nigeria's leading paints and coatings company, today announced its unaudited quarterly results for the period ended 31 March 2023.

Commenting on the results, Managing Director, Bolarin Okunowo, stated:

"The first quarter of 2023 was challenging due to high levels of inflation, uncertainties relating to the elections, the implementation of the currency redesign policy and limited availability of foreign exchange which put immense pressures on consumer spending. Like many companies, we felt the impact of the challenging market conditions on our performance. We, however, expect that the macroeconomic headwinds will stabilize post-elections, as such we remain confident that our commitment to deliver high quality products and leverage technology to provide services that exceed our customers' expectations will drive profitable growth".

Highlights

• Revenue declined 15% from prior year ("PY") to N4.0 billion.
• Gross profit of N1.4 billion, reflecting a decline of 25%. Gross margin lower by 4.6 percentage points, with margin impacted by input cost escalations and higher energy and distribution costs.
• Operating profit was 49% lower than PY at N391 million. Operating expenses were flat year on year.
• Profit before tax of N576 million, down 26% from N781 million in Q1 2022.
• Total profit for the period was N389 million, with net profit margin of 10%.

Performance Summary

In million ₦, unless otherwise stated	Q1 2023	Q1 2022	YoY
Revenue	3,971	4,656	(15%)
Gross Profit	1,358	1,808	(25%)
Gross Margin (% of Revenue)	34%	39%	(4.6 pp)
Other Operating Income	110	41	169%
Selling & Marketing expenses	(340)	(450)	(24%)
Administrative expenses	(737)	(638)	16%
Operating Expenses	(1,077)	(1,088)	(1%)
Operating Expenses (% of Revenue)	27%	23%	3.7 pp
Operating Profit	391	760	(49%)
Operating Margin (% of Revenue)	10%	16%	(6.5 pp)
Finance Income	208	22	861%
Finance Cost	(22)	(0.4)	5,378%
Net Finance Income	186	21	774%
Profit Before Tax	576	781	(26%)
Profit before Tax Margin (% of Revenue)	15%	17%	(2.3 pp)
Income Tax Expense	(187)	(254)	(26%)
Profit After Tax	389	527	(26%)
Profit after Tax Margin (% of Revenue)	10%	11%	(1.5 pp)

Chemical and Allied Products Plc - Q1 2023 Unaudited Results

NGX Ticker: CAP

In million ₦, unless otherwise stated	Mar-23	Dec-22	Δ
Non-current Assets	2,127	2,140	(1%)
Current Assets	12,747	11,028	16%
Assets Held for Sale	238	238	-
Total Assets	15,112	13,406	13%
Non-current Liabilities	337	337	0.1%
Current Liabilities	7,787	6,470	20%
Total Liabilities	8,123	6,807	19%
Equity	6,989	6,600	6%
Total Liabilities and Equity	15,112	13,406	13%

For more information, please contact:

Lolade Bashiru Investor [e-mail]

About CAP Plc

Chemical and Allied Products Plc (CAP) is a leading paints and coatings company in Nigeria with globally recognised brands such as Dulux, Sandtex, Caplux and Hempel. CAP manufactures and sells decorative paints and industrial coatings. CAP is the sole technological licensee of Akzo Nobel Coatings International B.V. and is the Nigerian representative of Hempel Paints South Africa (Pty) Limited. CAP pioneered the colour centre concept in Nigeria in 2005, which resulted in the evolution of the Nigerian paint industry. CAP is a public company listed on The Nigerian Exchange ("NGX"). It is a subsidiary of UAC of Nigeria PLC which holds 57.85% of the company's shares. For more information visit https://www.capplc.com/

CAP's Investors Portal

CAP has a dedicated investors' portal on its corporate website which can be accessed via this link: https://www.capplc.com/investor-relations/. This Earnings Press Release should be read in conjunction with the Unaudited Financial Statements for the period ended 31 March, 2023 available on our website. For any investment related enquiry, please contact Lolade Bashiru, Investor Relations by electronic mail at [e-mail].

Disclaimer

This announcement contains or will contain forward-looking statements which reflect management's expectations regarding the Company's future growth, results of operations, performance, business prospects and opportunities. Wherever possible, words such as "anticipate", "believe", "expects", "intend" "estimate", "project", "target", "risks", "goals" and similar terms and phrases have been used to identify the forward- looking statements. These statements reflect management's current beliefs and are based on information currently available to management. Certain material factors or assumptions have been applied in drawing the conclusions contained in the forward-looking statements. These factors or assumptions are subject to inherent risks and uncertainties surrounding future expectations generally. Chemical and Allied Products Plc cautions readers that several factors could cause actual results, performance, or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully, and undue reliance should not be placed on the forward-looking statements. For additional information with respect to certain of these risks or factors, reference should be made to the Company's disclosure materials filed from time to time with Securities and Exchange Commission of Nigeria. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether because of new information, future events or otherwise.