Chemical and Allied Products Plc (CAP), one of Nigeria’s leading paints and decorative companies, has recorded a revenue of N8.7 billion for the year ended December 31, 2020, indicating an increase of 3.9 per cent compared to N8.4 billion recorded in 2019.
Selling and marketing expenses fell 3.5 per cent from N584 million to N564 million, while administrative expenses rose 19.7 per cent to N1.636 billion.
Gross profit declined 5.5 per cent to N3.755 billion from N3.973 billion decline due to input cost pressures on account of currency devaluation and supply chain disruptions. Earnings interest and tax(EBIT) fell from N2.120 billion to N1.645 billion due to the decline in gross profit and investments in talent to strengthen the work force and drive profitable growth.
Profit before tax stood at N1.896 billion in 2020, compared to N2.546 billion in 2019, while profit after tax (PAT) printed at N1.289 billion as against N1.742 billion in 2019.
Based on the performance, the board of directors has recommended a dividend of N2.10 per share.
Commenting on the results, Managing Director/CEO of CAP, Mr. David Wright, said: “CAP recorded modest top-line growth last year despite the COVID-19 lockdown in the second quarter of 2020 and protests in the fourth quarter of 2020, effectively losing seven weeks of sales. “We are encouraged by the growth in revenue which has been solely driven by underlying volume growth in line with our strategy. “Alongside the rest of the world, we experienced supply chain disruptions which impacted our raw material sourcing and resulted in input costs pressures.”
According to him, they have embarked on initiatives focused on mitigating those disruptions and expect to see positive results in 2021.
“We announced the proposed merger between CAP and Portland Paints and Products Nigeria Plc in the fourth quarter of 2020. We have made significant progress and expect to conclude the merger in the second quarter of 2021, subject to receiving final regulatory approvals. I am pleased to announce that the Board approved that a dividend of 210 kobo per ordinary share be recommended for payment to our shareholders,” he said.
According to him, merger presents a unique opportunity that would benefit all stakeholders, from shareholders to customers as well as the broader economy.
“I am excited by the prospect of an enlarged company with a broader decorative paint portfolio covering the premium, mid-market and affordable segments and the inclusion of marine and protective coatings, all of which will benefit our customers and shareholders,” he said.