CAP Profit Up 5%, Offers 120 Kobo Final Dividend | Independent Newspapers Limited
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CAP Profit Up 5%, Offers 120 Kobo Final Dividend

CAP plc
Posted: Apr 1, 2016 at 3:00 am   /   by   /   comments (0)

Chemical and Allied Products Plc (CAP) on Thursday made public its audited December 2015 full year numbers on the floor of the Nigerian Stock Exchange which was flat as the company struggled to contend with the unfriendly business environment in 2015 on the back of electioneering, minimal government and household infrastructure spend.

Revenue growth was flat at 0.99 percent to N7.056 billion from N6.987 billion in 2014 full year. Muted volume sales on the back of falling industrial and household demand may have accounted for the flat increases in revenue.

Costs of sales rose faster by 2.33 percent (compared to 0.99 percent in revenue) to N3.468 billion from N3.389 billion in the corresponding period of 2014. This resulted into a contraction in gross profit margin from 51.50 percent to 50.85 percent.

Distribution expenses dropped by 28.14 percent to N377 million from N525 million in 2014 full year, representing a drop in distribution expenses pretty much ties into a muted sales growth scenario and serves as the major boost to profitability. Administrative expenses on the other hand went up by 10.42 percent to N930 million.

A 4.39 percent drop in operating expenses lifts earnings. PBT and PAT rose 5.24 percent and 4.63 percent on the back of a 4.39 percent contraction in combined operating expenses. PBT and PAT grossed N2.57 billion and N1.739 billion respectively. EBITDA margins also received, a boost expanding to 34.3 percent. EBITDA stood at N2.422 billion up from N2.367 billion in 2014. The 46 percent growth in finance income to N228 million also added to the jump in profit.

The company proposed 120 kobo final dividend after an interim of 115 kobo was paid on December 15, 2015. Total dividend for the financial stood at 235 kobo and implies a yield of 8.44 percent. The company’s share price was unchanged at the end of Thursday’s trading session.

The key take away from this number, according to experts at Elixir Capital, will be that CAP Plc was in the face of muted sales growth and higher growth in cost of sales and was able to tame down operating expenses which helped to lift after-tax-earnings.

For 2016 full year, experts at Elixir Capital said that the opening of additional Dulux Colour centres in Yola and Gombe, and Dulux Colour Shops in Port-Harcourt, Ado-Ekiti, Ibadan, and Abuja will boost gross revenue while the cost drive will further come down.