In 2023, Chemical and Allied Products Plc experienced a significant increase in finance costs, which surged by 362.97% to N 155.35m from N33.55m. This sharp rise was primarily driven by a 377.27% increase in interest on borrowings.
The interest on borrowings jumped to N153.92m from N32.25m in the previous year, 2022.
Despite the notable rise in finance costs, the company managed to improve its profit after tax by six percent to N2.5bn in 2023, compared to N2.4bn in the previous year.
According to CAP’s audited report, revenue also grew significantly by 24%, reaching N23.9bn instead of N14.2bn in 2022, marking the highest revenue in the last five years for the company.
The company’s directors have recommended a full-year ordinary dividend of N1.55k per 50 kobo share to the shareholders, amounting to N1.26bn cash distribution, the same as the previous year’s distribution in 2022.
In his comments on the results, Managing Director Bolarin Okunowo stated, “Our performance in FY 2023 showcases our resilience as a business. Despite facing various policy and macroeconomic challenges, such as the cash crunch due to the naira re-design, removal of petrol subsidies causing a surge in raw material prices, general goods, and services, and foreign exchange issues, we have maintained our commitment to excellence by delivering top-notch products and services that satisfy our customers.
“Looking ahead, we will focus on solidifying our efforts to ensure the company remains resilient against macroeconomic challenges while continuously surpassing our customers’ expectations.”
The Central Bank of Nigeria’s Monetary Policy Committee set the benchmark interest rate at 18.75% in July and maintained this rate for the remainder of the year.
However, in February, the MPC raised the benchmark interest rate to 22.75% before further increasing it to 24.75% as of Tuesday.