CAP posts N8.7bn revenue in 2020

Chemical and Allied Products Plc (CAP) has announced that its revenue grew to N8.7 billion in 2020 from N8.4 billion in 2019, representing a 3.9 per cent increase.
According to the company, the rise in revenue was driven by strong volume growth despite the disruptions in April, May and October. The company’s unaudited financial statements for the year ended December 31, 2020 revealed a 5.5 per cent decline to N3.8 billion in its gross profit due to input cost pressures on account of currency devaluation and supply chain disruptions.
Further data obtained from the Nigerian Stock Exchange (NSE) website showed that the company’s Earnings before Interest and Taxes (EBIT) declined by 22.4 per cent to N1.6 billion and 41.1 per cent decline in its net finance income on account of lower investment income yields resulted in a 26 per cent decline in its profit before tax (PBT) which settled at N1.9 billion in full year (FY) of 2020.
The company’s total profit sunk by 26 per cent from N1.7 billion in 2019 to N1.3 billion in 2020 while earnings per share for the period was down by 26.1 per cent to 182 kobo from 249 kobo in the corresponding period of 2019.
Commenting on the performance, the Managing Director, CAP Plc, David Wright, stated that the company 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 7 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. We have embarked on initiatives focused on mitigating these 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 received preliminary regulatory approvals and an order from the Federal High Court to hold a Court-Ordered Meeting. Merger completion is subject to shareholder approval and final regulatory approvals and we expect to conclude the merger in the first quarter of 2021,” he said.